That
doesn’t
mean
Rithm
is
sitting
on
the
sidelines.
New
York-based
Rithm
plans
to
remain
active
in
mergers
and
acquisitions,
while
looking
to
capitalize
on
subservicing
opportunities
that
may
emerge
as
a
result
of
the
Rocket-Mr.
Cooper
transaction. 

“Performance
matters
first,
and
we
will
never
sacrifice
performance
in
lieu
of
growing
our
platform,”
Michael
Nierenberg,
Rithm’s
chairman,
CEO
and
president,
told
analysts
during
the
company’s
first-quarter
earnings
call
on
Friday.

In
Q1
2025,
Rithm
reported
$80.7
million
in
net
income,
down
from
$291.9
million
in
the

previous
quarter.
GAAP
net
income
came
in
at
$36.5
million.

Rithm
has
already
been
active
on
the
M&A
front.
In
2023,
it
acquired
$1.4
billion
in
consumer
loans
from

Goldman
Sachs,
completed
a

$720
million
purchase
of

Sculptor
Capital
Management
and

struck
a
deal
for

Computershare
Mortgage
Services
and
its
subsidiary,

Specialized
Loan
Servicing.

Looking
ahead,
Nierenberg
said
Rithm’s
M&A
pipeline
remains
“very
active,”
particularly
in
the
mortgage
and
asset
management
spaces.
Market
volatility
has
brought
valuation
down,
while
scale
makes
a
difference. 
“We
are
active
and
we
hope
to
get
deals
done
here
in
the
near
future,”
Nierenberg
added. 

The
mortgage
business 

Newrez,
Rithm’s
mortgage
platform,
posted
a
19%
pretax
return
on
its
$5.5
billion
in
equity
for
the
first
quarter.
Net
income
reached
$146.7
million,
down
from
$316
million
in
Q4
2024.

In
total,
funded
loan
volume
totaled
$11.8
billion,
up
9%
year
over
year,
though
down
from
$17.3
billion
in
the
previous
quarter.
The
lender
continues
to
rely
heavily
on
the
correspondent
channel
and
saw
its
gain-on-sale
margin
improve
to
1.37%
in
Q1
2025.

Newrez’s
servicing
portfolio
grew
to
$845
billion
in
unpaid
principal
balance,
up
30%
year
over
year.
That
includes
$254
billion
in
third-party
servicing—more
than
double
from
a
year
ago—and
the
company
expects
this
segment
to
continue
expanding.

Newrez
president

Baron
Silverstein
said
he
sees
opportunities
in
subservicing
as
competitors
consolidate.
He
said
the
firm will
continue
to
focus
on
its
consumer
direct
refinance
recapture,
which
was
at
56%
in
the
first
quarter. 

Overall,
Nierenberg
said
the
company
continues
to
work
on
its
capital
structure
to
unlock
shareholder
value,
so
that
the
public
markets
can
value
it
correctly.
One
option
is
to
turn
Newrez
into
a
public
company. 

Following
the
earnings
call,
analysis
at

BTIG
wrote
that
downsize
risk
to
Rithm’s
valuation
appears
limited,
compared
to
asset
managers
and
mortgage
originators.
Valuations
for
asset
managers
are
down
on
macro
concerns
and
wider
credit
spreads,
but
there’s
a
case
for
longer-term
upside
on
the
heels
of
the
Rocket
and
Mr.
Cooper
deal,
they
said. 

“We’ve
been
bullish
on
the
prospects
for
RITM
to
spin
out
or
monetize
its
~$4
billion
of
net
capital
in
NewRez,
mostly
because
we
think
the
business
has
stronger
and
more
stable
value
if
it
can
flexibly
retain
earnings
outside
the
current
REIT
structure,”
the
BTIG
analysts
wrote. 

Rithm
Capital

shares
were
trading
at
$10.50
on
Friday
at
about
noon,
up
1.10%.