Rithm Capital's Acquisition Strategy and Diversification Efforts Drive Growth and Yield

Rithm Capital (RITM) supports its dividend with distributable earnings and has a history of making accretive acquisitions that expanded its investment scope beyond mortgages. The company continues to diversify its revenue mix, and in September, it announced an acquisition that should further enhance its investment portfolio. With a strong track record of financial performance, RITM appears well-positioned for continued growth and profitability.

Rithm Capital Corp. (NYSE: RITM), a global alternative asset manager, has announced its third quarter 2025 common and preferred stock dividends. The company's Board of Directors declared a dividend of $0.25 per share of common stock for the third quarter 2025, payable on October 31, 2025, to shareholders of record on October 1, 2025 Rithm Capital Corp. Declares Third Quarter 2025 Common and Preferred Dividends^[1].

In addition to the common stock dividend, the Board declared preferred stock dividends for the third quarter 2025. The dividends for Series A, Series B, Series C, and Series D preferred stocks were set at $0.6564577, $0.6461077, $0.6032383, and $0.4375000 per share, respectively. These dividends reflect floating rates based on the three-month CME SOFR plus a spread adjustment and are payable on November 17, 2025, to preferred shareholders of record on November 1, 2025 Rithm Capital Corp. Declares Third Quarter 2025 Common and Preferred Dividends^[1].

Rithm Capital's latest acquisition, Paramount Group (PGRE), is expected to further enhance its investment portfolio and diversify its revenue mix. The acquisition, announced in September 2025, adds a new stream of revenue and income from office commercial real estate, expanding Rithm Capital's asset footprint in commercial real estate and asset management Rithm Capital: Acquisition, Yield, And Upside^[2].

The company has a history of making accretive acquisitions that have expanded its investment scope beyond mortgages. This diversification strategy aims to mitigate risks associated with its core mortgage origination and servicing business. Rithm Capital continues to generate a significant portion of its revenue and earnings from this core business, but the acquisition of Paramount Group signals a shift towards a more diversified investment portfolio Rithm Capital: Acquisition, Yield, And Upside^[2].

Rithm Capital's strong track record of financial performance and its ability to support its dividend with distributable earnings position it well for continued growth and profitability. The company's valuation remains attractive, trading at a 9% discount to book value, which may highlight investor concerns about the company's diversified business model and exposure to mortgage servicing rights (MSRs) Rithm Capital: Acquisition, Yield, And Upside^[2].

While Rithm Capital faces risks associated with the valuation of mortgage servicing rights in a falling-rate environment, its ongoing efforts to diversify its investment portfolio and expand its asset management business suggest a proactive approach to risk management. The acquisition of Paramount Group is a strategic move that could potentially drive higher distributable earnings growth and improve the overall quality of earnings.