PennyMac Financial price target raised to $89 from $82 at Piper Sandler

Piper Sandler raised the firm’s price target on PennyMac Financial to $89 from $82 and keeps an Overweight rating on the shares. The analyst believes PennyMac is in a “sweet spot right now” whereby its valuation reflects continued pressure on earnings while its outlook for earnings should continue to improve, particularly amid lower rates due to a weakening economy. The company’s earnings are under-stated relative to peers due to mortgage servicing rights accounting methodologies and it stands to benefit from decreasing competition within the correspondent broker origination channels, the analyst tells investors in a research note.