Velocity Financial Stock Earnings Reports

Velocity reported a steady Q1 2026 with metrics largely in line with guidance and management emphasizing disciplined, low-LTV real estate lending. Key highlights: portfolio UPB grew to $6.8 billion (up 25.6% YoY; +5.3% QoQ); Q1 loan production ~ $639M across ~1,600 loans; weighted-average coupon on new HFI originations ~10.1% (5-quarter avg ~10.3%); portfolio weighted-average coupon ~9.75%; weighted-average LTV on new originations ~64.9% (quarter average ~62.5%); net interest margin ~3.56% (guidance ~3.5%). Credit performance: nonperforming loan (NPL) rate 10.1% (down 70 bps YoY); strong NPL resolutions (recoveries and gains, with recovered revenue on resolved NPLs of $4.6M and net gains on REO activity of $3.5M in Q1); combined valuation loss allowance on the HFI portfolio was ~83 bps (CECL reserve on amortized cost loans $4.9M, 25 bps). Funding and liquidity: completed inaugural $500M unsecured corporate bond (rated by Moody’s and Fitch), used proceeds to pay down secured corporate note and warehouse lines; total liquidity ~$329M (cash ~$87M + ~$242M available on unfinanced collateral); available warehouse capacity ~$836M (max ~$935M); recourse debt-to-equity 1.0x, total debt-to-equity 9.6x. Management view/outlook: capital markets and origination pipelines are healthy, expect origination volumes to pick up in H2 2026, continue targeting ~3.5% NIM and disciplined margin management to sustain strong ROE (management expects high-teens ROE to be sustainable).