Newtek: Valuation Compression On Track

Summary

  • We had upgraded Newtek to neutral from our earlier short-sell idea as the stock entered the upper end of its normal valuation range.
  • The stock has dropped another 21% since then.
  • We are now getting close to a good valuation to buy this.
  • We review Q1-2022 and tell you where we would be excited to own this.
  • Looking for option income ideas that focus on capital preservation? I offer this and much more at my exclusive investing ideas service, Conservative Income Portfolio. Learn More »

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When we last covered Newtek (NASDAQ:NEWT) we gave it an upgrade to a neutral rating. The rationale back then was that we entering the upper atmosphere from outer space on the valuation front. Specifically, we said:

About NEWT stock

Seeking Alpha

NEWT EPS estimates

Seeking Alpha

Newtek Business Services price % change
Data by YCharts

Newtek convert plan

NEWT Q1-2022 Presentation

Newtek price % change
Data by YCharts

Newtek price to tangible book value
Data by YCharts

Growth in lending staff to meet demand

NEWT Q1-2022 Presentation

Currency analysis of non-guaranteed portfolio

NEWT Q1-2022 Presentation

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