Q3 Earnings Outperformers: Flagstar Financial (NYSE:FLG) And The Rest Of The Thrifts & Mortgage Finance Stocks

Looking back on thrifts & mortgage finance stocks’ Q3 earnings, we examine this quarter’s best and worst performers, including Flagstar Financial (NYSE:FLG) and its peers.

Thrifts & Mortgage Finance institutions operate by accepting deposits and extending loans primarily for residential mortgages, earning revenue through interest rate spreads (difference between lending rates and borrowing costs) and origination fees. The industry benefits from demographic tailwinds as millennials enter prime homebuying age, technological advancements streamlining the loan approval process, and potential interest rate stabilization improving affordability. However, significant headwinds include net interest margin compression during rate volatility, increased competition from fintech disruptors offering digital-first experiences, mounting regulatory compliance costs, and potential housing market corrections that could impact loan portfolios and default rates.

The 15 thrifts & mortgage finance stocks we track reported a mixed Q3. As a group, revenues beat analysts’ consensus estimates by 4.7% while next quarter’s revenue guidance was 1.9% above.

In light of this news, share prices of the companies have held steady as they are up 2.5% on average since the latest earnings results.

Flagstar Financial (NYSE:FLG)

Tracing its roots back to 1859 and rebranded from New York Community Bancorp in 2024, Flagstar Financial (NYSE:FLG) is a bank holding company that offers commercial and consumer banking services, with specialties in multi-family lending, mortgage originations, and warehouse lending.

Flagstar Financial reported revenues of $497 million, down 23.1% year on year. This print fell short of analysts’ expectations by 3.7%. Overall, it was a softer quarter for the company with a significant miss of analysts’ revenue estimates and a slight miss of analysts’ net interest income estimates.

Commenting on the Company's third quarter 2025 performance, Chairman, President, and Chief Executive Officer, Joseph M. Otting stated, "Our third-quarter 2025 performance provides further evidence that we are successfully executing on each of our strategic priorities, which we first outlined during the first quarter of last year. Our operating results improved significantly during the quarter as key balance sheet and income statement metrics continue to trend positively.

Interestingly, the stock is up 7.6% since reporting and currently trades at $12.44.

Read our full report on Flagstar Financial here, it’s free for active Edge members.

Best Q3: Ellington Financial (NYSE:EFC)

Operating under the guidance of Ellington Management Group, a respected name in structured credit markets, Ellington Financial (NYSE:EFC) acquires and manages a diverse portfolio of mortgage-related, consumer-related, and other financial assets to generate returns for investors.

Ellington Financial reported revenues of $82.76 million, up 23.6% year on year, outperforming analysts’ expectations by 4.9%. The business had an exceptional quarter with a beat of analysts’ EPS estimates and an impressive beat of analysts’ revenue estimates.

Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 1.3% since reporting. It currently trades at $13.49.

Is now the time to buy Ellington Financial? Access our full analysis of the earnings results here, it’s free for active Edge members.

Weakest Q3: WaFd Bank (NASDAQ:WAFD)

Founded in 1917 and rebranded from Washington Federal in 2023, WaFd (NASDAQ:WAFD) is a bank holding company that provides lending, deposit services, and insurance through its Washington Federal Bank subsidiary across eight western states.

WaFd Bank reported revenues of $187.2 million, flat year on year, falling short of analysts’ expectations by 1.7%. It was a disappointing quarter as it posted a significant miss of analysts’ net interest income and EPS estimates.

Interestingly, the stock is up 16.6% since the results and currently trades at $32.46.

Read our full analysis of WaFd Bank’s results here.

Arbor Realty Trust (NYSE:ABR)

With roots dating back to 2003 and a focus on the stability of multifamily housing, Arbor Realty Trust (NYSE:ABR) is a specialized lender that provides financing solutions for multifamily and commercial real estate while also originating and servicing government-backed mortgage loans.

Arbor Realty Trust reported revenues of $112.4 million, down 28.2% year on year. This number came in 25.8% below analysts' expectations. Aside from that, it was a mixed quarter as it also produced a beat of analysts’ EPS estimates but a significant miss of analysts’ revenue estimates.

Arbor Realty Trust had the weakest performance against analyst estimates and slowest revenue growth among its peers. The stock is down 31% since reporting and currently trades at $7.98.

Read our full, actionable report on Arbor Realty Trust here, it’s free for active Edge members.

PennyMac Financial Services (NYSE:PFSI)

Founded during the 2008 financial crisis to help address the mortgage market meltdown, PennyMac Financial Services (NYSE:PFSI) is a specialty financial services company that originates, services, and manages investments related to residential mortgage loans in the United States.

PennyMac Financial Services reported revenues of $637.1 million, up 11.3% year on year. This result beat analysts’ expectations by 9%. It was an exceptional quarter as it also logged an impressive beat of analysts’ net interest income estimates and a solid beat of analysts’ revenue estimates.

The stock is up 11% since reporting and currently trades at $134.21.

Read our full, actionable report on PennyMac Financial Services here, it’s free for active Edge members.

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