Keefe, Bruyette & Woods Downgrades Redwood Trust to Market Perform, Cuts Target to $3.50

Keefe, Bruyette & Woods downgraded Redwood Trust Inc (NYSE: RWT) to market perform from outperform before the open on Thursday and cut its price target to $3.50 from $4.25.

One firm acted on the stock this session, and it is one of eight firms that have rated Redwood Trust in the past year. Before the action, six of those firms rated the stock positive and two rated it neutral, with none negative. The median target across that group was $4.88, with a range from $3.50 to $6.50. The new $3.50 target sits at the low end of that range.

The stock closed at $2.96 on Wednesday, Nov. 11, 2026, and over the 20 sessions to that close it rose 0.3%. On Thursday the shares fell 3.7% to close at $2.85, while the S&P 500 ETF fell 0.3% over the same session.

Scale of the company

The company had a market capitalization of about $345.2 million before the filing. For the latest reported quarter, ended Sept. 30, net interest income was $40.6 million, up 171% from a year earlier, while the net loss was $45.5 million, compared with a loss of $7.7 million a year earlier. Cash and equivalents stood at $201.1 million at that date.

Recent filings

Redwood Trust filed its quarterly report on Form 10-Q on Monday, Nov. 9, 2026, three days before the rating change. On Nov. 3 it also filed an 8-K, linked here, covering a planned conversion to a C-corporation that would end its REIT status, along with a preferred stock exchange offer and a planned one-for-five reverse stock split.