What Happened?

Shares of mortgage banking company PennyMac Financial Services (NYSE: PFSI) jumped 3.4% in the afternoon session after Keefe, Bruyette & Woods raised its price target on the stock and boosted its earnings estimates. 

The research firm lifted its price target to $138 from $129, while it kept a Market Perform rating on the shares. The change followed higher earnings per share forecasts for 2025, 2026, and 2027. This move suggested a more positive view of the company's ability to make money in the future.

After the initial pop the shares cooled down to $132.60, up 3.1% from previous close.

Is now the time to buy PennyMac Financial Services? Access our full analysis report here.

What Is The Market Telling Us

PennyMac Financial Services’s shares are not very volatile and have only had 8 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.

The previous big move we wrote about was 2 days ago when the stock gained 5.1% on the news that the company reported impressive third-quarter 2025 results that surpassed analyst estimates for both revenue and profit. 

For the quarter, PennyMac Financial reported revenue of $632.9 million and a GAAP profit of $3.37 per share. These results significantly beat Wall Street's expectations, with revenue coming in 9.9% above consensus and earnings per share surpassing estimates by 14.6%. The performance represented a strong year-over-year improvement, as revenue grew 10.6% and earnings per share more than doubled from the $1.30 reported in the same period last year. The impressive results demonstrated the company's recent acceleration in demand and profitability.

PennyMac Financial Services is up 32.8% since the beginning of the year, and at $132.60 per share, has set a new 52-week high. Investors who bought $1,000 worth of PennyMac Financial Services’s shares 5 years ago would now be looking at an investment worth $2,423.

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