Velocity Financial, Inc.
- Open
- 17.33
- Day high
- 17.74
- Day low
- 17.27
- Prev close
- 17.25
- Volume
- 111K
- Mkt cap
- $696M
- P/E (TTM)
- 6.3
- EPS (TTM)
- $2.83
- P/B
- 1.0
- P/S
- 1.0
- Yield
- —
- Per share
- —
- ▼Insiders net selling -$131K over the last 3 months (0 open-market buys, 4 sales)
- 🏛Institutions mixed (13F)
Velocity Financial, Inc. (VEL) is a Financial Services company listed on NYSE. The stock is down 3% over the past year. Over the trailing 3 months, insiders filed 0 open-market buys and 4 sales (SEC Form 4).
Velocity Financial, Inc. (VEL) financials & analyst ratings
Fundamentals (TTM)
Analyst consensus · 2 analysts
Source: exchange market data + company filings. Figures are trailing-twelve-month or as most recently reported. For informational purposes only — not investment advice.
VEL earnings date, history & EPS estimates
| Report date | EPS est | EPS actual | Surprise | Revenue | Rev. surprise |
|---|---|---|---|---|---|
| May 6, 2026 | $0.64 | $0.68 | +6.3% | $85M | +24.4% |
| Mar 11, 2026 | $0.67 | $0.93 | +38.8% | $182M | +240.2% |
| Nov 6, 2025 | $0.67 | $0.69 | +3.0% | $172M | +227.9% |
| Aug 7, 2025 | $0.54 | $0.73 | +34.4% | $152M | +252.2% |
| May 1, 2025 | $0.52 | $0.55 | +5.8% | $119M | +195.4% |
| Mar 6, 2025 | $0.48 | $0.60 | +25.0% | $125M | +192.4% |
| Nov 7, 2024 | $0.48 | $0.47 | -2.1% | $49M | +15.5% |
| Aug 1, 2024 | $0.41 | $0.45 | +9.8% | $107M | +113.3% |
| May 2, 2024 | $0.39 | $0.51 | +30.8% | $99M | +113.4% |
| Mar 7, 2024 | $0.38 | $0.46 | +21.1% | $94M | +97.2% |
| Nov 2, 2023 | $0.35 | $0.37 | +5.7% | $35M | -18.2% |
| Aug 3, 2023 | $0.33 | $0.38 | +15.2% | $30M | -15.5% |
VEL insider trading activity (SEC Form 4)
| Date | Insider | Type | Shares | Price |
|---|---|---|---|---|
| Jul 6, 2026 | Kelly Roland Thomasofficer: Chief Legal Officer and GC | Sell | 1,600 | $18.57 |
| Jun 29, 2026 | Szczepaniak Mark Rofficer: Chief Financial Officer | Sell | 1,573 | $18.07 |
| May 22, 2026 | Beckett Dorika Mdirector | Grant | 5,413 | $17.55 |
| May 22, 2026 | Pitstick Johndirector | Grant | 5,413 | $17.55 |
| May 22, 2026 | Schaefer Joy L.director | Grant | 5,413 | $17.55 |
| May 4, 2026 | Szczepaniak Mark Rofficer: Chief Financial Officer | Sell | 1,573 | $19.30 |
| Apr 17, 2026 | Taylor Jeffrey T.officer: Executive VP, Capital Markets | Sell | 2,130 | $20.00 |
| Apr 1, 2026 | Szczepaniak Mark Rofficer: Chief Financial Officer | Sell | 1,573 | $18.13 |
| Mar 31, 2026 | Kelly Roland Thomasofficer: Chief Legal Officer and GC | Sell | 814 | $18.22 |
| Mar 31, 2026 | Kelly Roland Thomasofficer: Chief Legal Officer and GC | Sell | 14,026 | $18.03 |
| Mar 2, 2026 | Szczepaniak Mark Rofficer: Chief Financial Officer | Sell | 1,573 | $18.32 |
| Feb 2, 2026 | Taylor Jeffrey T.officer: Executive VP, Capital Markets | Sell | 1,772 | $20.33 |
| Feb 2, 2026 | Szczepaniak Mark Rofficer: Chief Financial Officer | Sell | 1,573 | $20.53 |
| Jan 29, 2026 | Tam Fionaofficer: Chief Accounting Officer | Tax | 4,251 | $20.22 |
| Jan 29, 2026 | Farrar Christopher D.director, officer: Chief Executive Officer | Tax | 64,705 | $20.22 |
Source: VEL SEC Form 4 filings, latest Jul 6, 2026. For informational purposes only — not investment advice.
See the full VEL insider & 13F page →Velocity Financial, Inc. company profile
Overview
Velocity Financial, Inc. (NYSE:VEL) is a specialized real estate finance company founded in 2004 and headquartered in Westlake Village, California. The company went public in January 2020 and has established itself as a niche lender serving real estate investors across the United States. Velocity focuses primarily on originating and managing investor loans secured by small residential rental properties and commercial real estate, operating in market segments that are often underserved by traditional banks.
Business
Velocity Financial operates in the specialized real estate finance industry, specifically focusing on non-qualified mortgage (non-QM) lending to real estate investors. Unlike traditional residential mortgages that are heavily regulated under qualified mortgage rules and typically serve owner-occupants, Velocity's core business involves providing financing to property investors who acquire, renovate, and manage rental properties. The company's primary product is investor loans secured by small residential rental properties (typically 1-4 units) and small commercial properties. These loans are designed for real estate investors who need financing to purchase rental properties, refinance existing investments, or access capital for property improvements. The loans typically have higher interest rates than conventional mortgages, reflecting both the investor nature of the borrowers and the specialized underwriting required. Velocity originates these loans through a network of independent mortgage brokers rather than direct consumer marketing. The company then either holds these loans in its portfolio to generate net interest income or packages them into securitizations - a process where pools of loans are sold to investors in the capital markets. This dual approach allows Velocity to both generate ongoing interest income and realize gains from loan sales. The company operates as a single business segment focused on this investor lending niche, with approximately 100% of its revenue derived from activities related to originating, holding, and securitizing these specialized real estate investor loans.
Revenue model
Velocity Financial generates revenue through multiple complementary streams within its real estate investor lending business model. The primary revenue source is net interest income earned from holding loans in its portfolio, where the company earns the spread between the interest rates charged to borrowers (currently averaging around 9.5-10.5%) and its own cost of funds from warehouse lines and securitization financing. The company also generates gain on sale income when it packages loans into securitizations and sells them to institutional investors. During the securitization process, Velocity typically retains subordinate interests in these transactions, continuing to earn residual cash flows over time. Additionally, the company earns loan servicing income from managing the ongoing collection and administration of loans it has originated, whether held in portfolio or sold. Velocity's customers are real estate investors - individuals and entities who purchase residential rental properties or small commercial properties as investments. These borrowers often cannot obtain financing from traditional banks due to the investment nature of their purchases, non-standard income documentation, or the specialized underwriting requirements for rental properties. Several factors influence Velocity's profit margins. Interest rate environment significantly impacts both funding costs and the spreads the company can charge borrowers. Credit performance of the loan portfolio affects provisioning expenses and actual losses. The securitization market conditions determine how efficiently Velocity can access capital markets funding and the gains it can realize on loan sales. Competitive dynamics from other non-bank lenders and the level of traditional bank participation in investor lending also influence pricing power. Regulatory changes affecting either the company's operations or its borrowers' activities could impact demand and profitability.
Competitive moat
Velocity Financial operates in a specialized niche that provides some competitive advantages, though its moat is relatively narrow. The company's primary competitive advantage stems from its specialized expertise in underwriting real estate investor loans, a segment that requires different analytical skills compared to traditional residential mortgages. This includes understanding rental income potential, property management considerations, and the financial profiles of real estate investors. The company benefits from regulatory barriers that limit traditional banks' participation in this market. Post-financial crisis banking regulations have made many banks reluctant to engage in investor lending, particularly for smaller loan amounts. This regulatory environment has created a persistent opportunity for specialized non-bank lenders like Velocity. Velocity's established broker network and operational infrastructure provide some switching costs and relationship advantages. The company has built systems and processes specifically designed for investor loan origination and servicing, which would be costly for new entrants to replicate. However, the company's moat is not particularly strong. The business model is relatively straightforward and could be replicated by well-capitalized competitors. Competition comes from other non-bank lenders in the space, private credit funds, and potentially traditional banks if regulatory attitudes shift. Technology-enabled lending platforms could also disrupt the traditional broker-based origination model. The company's competitive position depends significantly on maintaining access to cost-effective funding through securitization markets, which could be challenged during periods of capital market stress.
Risks & safety
Velocity Financial presents a moderate margin of safety profile with some notable strengths and risks. **Liquidity and Solvency:** - Strong liquidity position with $51.7 million in cash and $238 million in available warehouse capacity as of Q1 2025 - Debt-to-equity ratio of 9.4x reflects the leveraged nature of the lending business, though this is typical for mortgage companies - No significant near-term solvency concerns given access to securitization markets **Valuation Metrics:** - Price-to-earnings ratio of 8.6x suggests reasonable valuation relative to earnings - Price-to-book ratio of 1.12x indicates modest premium to book value - EV/EBITDA of 1.4x appears attractive, though EBITDA calculations for financial companies require careful interpretation **Credit and Operational Risks:** - Non-performing loan rate of 10.8% is elevated but stable, with management demonstrating ability to resolve NPLs above par value - CECL loan loss reserves at 19 basis points appear light for the risk profile - Heavy dependence on securitization markets for funding creates refinancing risk during market stress periods - Interest rate sensitivity could impact both funding costs and borrower demand
Recent development
Over the past few years, Velocity Financial has executed a focused growth strategy centered around its "5x25 objective" - targeting growth of its loan portfolio from approximately $1 billion to $5 billion by 2025. The company successfully achieved this goal ahead of schedule, reaching $5.1 billion by the end of 2024 and setting a new target of $10 billion over the next five years. Key strategic developments include expansion into commercial lending through the creation of a dedicated commercial lending division focusing on owner-occupied commercial real estate. This has contributed to increased average loan sizes and helped diversify the portfolio beyond traditional 1-4 unit residential rental properties. The company has significantly enhanced its capital markets execution, completing multiple securitizations with increasingly favorable terms. Management has noted improved investor reception and tighter spreads in recent securitizations, with some transactions being oversubscribed by 6x. This improved execution has enhanced profitability and provided more reliable access to funding. Velocity has also invested in technology infrastructure and operational scalability, with management indicating current systems can handle 10-20% more volume without significant additional investment. The company has grown its origination capabilities, adding loan production staff and expanding its broker network relationships. Recent quarters have shown strong momentum with loan originations increasing 69% year-over-year in Q1 2025, driven by continued demand from real estate investors and limited competition from traditional banks. The company has maintained disciplined underwriting standards while growing production, with weighted average loan-to-value ratios remaining in the low-to-mid 60% range.
VEL company profile · for informational purposes only — not investment advice.
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