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New Residential Investment Corp. (NRZ) CEO Michael Nierenberg on Q1 2020 Results - Earnings Call Transcript

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New Residential Investment Corp. (NRZ) Q1 2020 Earnings Conference Call May 5, 2020 8:00 AM ET

Company Participants

Kaitlyn Mauritz - Investor Relations

Michael Nierenberg - Chairman, Chief Executive Officer and President

Nick Santoro - Chief Financial Officer

Jack Navarro - President and Chief Executive Officer, Servicing, NewRez

Bruce Williams - Chief Executive Officer, Shellpoint Partners

Andrew Sloves - Director, Audit Committee Compensation Committee

Conference Call Participants

Tim Hayes - B. Riley FBR

Bose George - KBW

Giuliano Bologna - BTIG

Stephen Laws - Raymond James

Trevor Cranston - JMP Securities

Kevin Barker - Piper Sandler

Matthew Howlett - Nomura


Good day and welcome to the New Residential First Quarter 2020 Earnings Call. All participants will be in listen-only mode. [Operator Instructions] Please note that this event is being recorded. I would now like to turn the conference over to Kaitlyn Mauritz with Investor Relations. Please go ahead, ma’am.

Kaitlyn Mauritz

Thank you, Rocco and good morning everyone. I would like to welcome you today to New Residential’s first quarter 2020 earnings call and thank you for joining us. Joining me here today are Michael Nierenberg, our Chairman, CEO and President; Nick Santoro, our Chief Financial Officer; and Jack Navarro, President and CEO of the Servicing division of NewRez.

Throughout the call this morning, we are going to reference the earnings supplement that was posted to the New Residential website this morning. If you have not already done so, I would encourage you to download the presentation now.

Before I turn the call over to Michael, I would like to point out that certain statements today will be forward-looking statements. These statements, by their nature, are uncertain and may differ materially from actual results. I encourage you to review the disclaimers in our press release and earnings supplement regarding forward-looking statements and to review

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Comments (22)

Blacklick Capital profile picture
So let me understand....if you can avoid mark to market....you can stabilize book value...EVEN THOUGH 40% of your loans are in forbearance? LMAO.... So the financial engineering that NRZ is contemplating is to shift resources to give the appearance...to regulators and ratings agencies that there is stability in their business. NRZ, PMT, and TWO are the darlings of Credit Suisse in the go forward world....assuming there is normalcy. You know, that people pay their loans and are rehired. There is a leap of faith that is being sold, disguised and repackaged. The servicers, COOP included are DOA for now. FED put may have allowed a doubling of the booked equity, but the whole thesis for investing in these companies is destroyed...for now. Do not speculate as a long term investor. You really have financial engineering, equity destruction and bailouts ahead. The dust needs to settle and then at least 2 quarters of real stability. I will watch as a hobby. And I hope they all are saved. It is a great business until it is not. And yes, I do not blame NRZ. They were not a leverage play per se.
Not even sure it makes sense for NRZ to continue operating as a REIT. Not sure how they’re passing the REIT tests given all the assets they sold.
This management team is slippery. CEO is really trying to paint a rosy picture and avoid specifics. Almost tried to make it seem like a growth story right now.

Had to press them 4 times before Mr. Navarro admits that the May forbearance picture is not actually trending better than April and it's way too soon to tell how this will actually shake out. Which is the same thing the stronger companies have said. If you don't follow other companies involved in origination and servicing you'd probably be really positive after this call.
I always look for what's have been done and what's being done to control situation. Managment being preemptive and active not waiting for help or solution from outside. Solid company and it should survive this!
Panzerman profile picture
I find Earnings Call Transcripts funny on Seeking Alpha. They are normally filled with useful information and clues about what managements plans are. Yet there are usually very few comments....why? It actually takes time effort to read the material and time to digest it. The typical reader does not like this as they go to the last paragraph to see the authors conclusion and will buy and sell on that. They consider this "due diligence". LOL :)
Performance to the shareholder means taking a salary cut and shoring up the dividend .
Are you suggesting NRZ will not make it because management is not reducing its compensation? Everything was very rosy BEFORE the Covid-19 problem and I assume it will also be rosy after this problem. You can replace management at less cost but I dare say it will not be as rosy.
@zenstar666 : Especially with MN at the helm!! He understands the market with which he deals and is, in my mind, the best man to be driving this company. Before and after this crisis, and hopefully in the future. Long NRZ
I agree. He's publicly committed to a book value of $14-$16. If so, our money doubles from here. I'll be very pleased with that. He and his team a laser focused on achieving outstanding returns for shareholders. I cannot ask for more.
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