CA - NewtekOne Stock: 10%+ Higher On Q1 Earnings But Still Cheap?

2024-05-10 07:00:00 ET

Summary

• NewtekOne, Inc.'s stock price has experienced significant fluctuations due to its transition from a BDC to a bank holding company.
• The company primarily originates Small Business Administration loans and has a unique business model compared to traditional banks.
• NewtekOne's performance metrics, such as return on equity and net interest margin, outperform those of J.P. Morgan, indicating its potential as an undervalued stock.

This article was co-produced with Williams Equity Research ("WER").

We’ve covered NewtekOne, Inc. (NEWT) on here and in our Investing Group many times , and this article’s purpose isn’t to explain the entire backstory. Suffice it to say, NewtekOne Inc. went from an unknown C-corp to one of the best performing business development companies aka BDCs to an underperforming bank holding company.

To be fair, the company had its doubters when it transitioned to a BDC, and it took time for the market to appreciate the company's unique business model. It wasn’t like other BDCs. And it outperformed almost every peer (all peers over certain timelines)....

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