UWM Holdings (NYSE:UWMC) stock spiked 9.1% in Friday morning trading to the highest point since the end of September after the residential mortgage lender turned in stronger-than-expected third-quarter results that were highlighted by improved loan origination volume Q/Q.
The company expects Q4 production to be $19B-26B and gain margin of 40-70 basis points.
Q3 originations of $33.5B bounced from $29.9B in the second quarter but remained down from $63B in the year-ago period. Gain margin was 0.52% versus 0.99% in Q2 and 0.94% in Q3 2021.
Purchase originations were $27.7B compared with $22.4B in Q2 and $26.5B in Q3 of last year. That was UWM's best purchase quarter in its history, it said.
Mortgage servicing rights unpaid principal balance of $306.0B edged down from $308.1B in Q2 but rose from $284.9B at Sept. 30, 2021; weighted average interest rate of 3.44% vs. 3.19% in Q2 and 2.95% in Q3 2021.
Adjusted net income was $252.5M, up from $165.3M in Q2, down from $254.8M a year ago.
Revenue of $684.2M, breezing past the average analyst estimate of $355.7M, climbed from $564.2M in Q2, but dipped from $690.3M a year before.
Total expenses of $353.8M vs. $348.0M in Q2 and $356.9M in Q3 2021.
Subsequent to September 30, the company's board declared a cash dividend of $0.10 a share on the outstanding shares of Class A common stock. The dividend is payable on January 10 to stockholders of record at the close of business on December 9.
Earlier, UWM Holdings Non-GAAP EPS of $0.16 beats by $0.18, revenue of $684.17M beats by $328.48M.