Nationstar Mortgage Holdings Inc Moves Lower On Keefe, Bruyette & Woods Downgrade

Shares of Nationstar Mortgage Holdings Inc NSM moved lower Monday on a downgrade from Keefe, Bruyette & Woods. KBW rated the company Underperform and maintained its $30 price target.

For the mortgage servicing market, analysts led by Bose George noted they "continue to think the regulatory overhang on the industry will eventually be lifted" and he expected the "servicing acquisition activity to remain slow."

New servicing will "increasingly be created by the servicers through their mortgage banking operations. We believe that this is a lower-margin business and will put continued downward pressure on earnings."

The report warned that the "primary risks to the company are reduced servicing acquisitions or a weaker mortgage banking environment."

The $30 price target equates to a 8.4x 2014 operating EPS and 7.5x the KBW 2015 EPS estimate.

Nationstar Mortgage Holdings Inc recently traded at $33.67, down 0.72 percent.