Rithm Posts Loss But Eyes $1.70 Earnings Target

Date of Call: Feb 13, 2026

Financials Results

• EPS: $0.06 negative per diluted share

Guidance:

• Earnings growth target of $1.60 to $1.70 per share following a recapitalization.
• Book value target of approximately $20 per share.
• Dividend yield target of around 9%.
• Genesis multifamily loan production projected between $6 billion and $7 billion for the year.

Business Commentary:

Financial Performance and Earnings Outlook:

• Rithm Property Trust reported GAAP earnings of $2.5 million for Q4, with a per diluted share of $0.06 negative, and a book value of approximately $31 per diluted share.
• The company aims to grow earnings to between $1.60 and $1.70 per share through a recapitalization and capital formation, indicating a focus on future earnings growth.

Balance Sheet and Capital Strategy:

• The company maintains a strong balance sheet with approximately $100 million in cash and liquidity, and total equity of $300 million.
• Rithm Property Trust is considering a recapitalization to enhance shareholder value and is patient in waiting for market stabilization to execute its plans.

Investment Activity and Pipeline:

• Rithm Property Trust has an active investment pipeline and has identified a pool of assets, around $1 billion, that could be acquired to immediately boost earnings.
• The primary focus is on acquiring multifamily loans from its operating business, Genesis, and other commercial real estate investments to avoid a J-curve in earnings growth.

Market Position and Strategic Goals:

• Rithm Property Trust sees opportunities in the commercial real estate sector, particularly in the office space, despite market volatility.
• The strategic goal is to create diversified earnings streams and capitalize on dislocated real estate sectors, similar to past successes with New Residential and Rithm Capital.

Sentiment Analysis:

Overall Tone: Positive

• Management expresses confidence in a 'clear path' to earnings growth, citing 'a clean balance sheet, a clean company, a dislocated sector.' They state the plan 'depends on capital formation' and highlight 'tremendous demand' for product, along with a 'very diversified business' and being 'extremely mindful of credit.'

Q&A:

• Question from Craig Kucera (Lucid Capital Markets): I think the Paramount transaction at Rithm Capital closed for about $1.6 billion and was generating about $300 million in NOI. Will RPT be receiving a slice of that NOI going forward? Or how should we think about the earnings impact or accretion from that investment?
  Response: RPT will receive a pro rata share of the Paramount deal's NOI from its $50 million balance sheet investment, back-ended relative to Rithm.

• Question from Craig Kucera (Lucid Capital Markets): Are you exploring feeding Rithm with more of those types of loans? And I guess when you talk about your future state on a larger capital base, is that sort of a wait for the common to kind of get closer to book value? Or kind of where -- what's the path there?
  Response: Loans from Genesis ($6B-$7B production expected) will feed both Rithm and RPT with no J-curve; capital raise for RPT is planned but depends on timing and market conditions, not expected to be highly dilutive.

• Question from Henry Coffey (Wedbush Securities): Timing, I mean, I think that's the only question at this point. Getting RPT over book value, that's a big jump. Is there a tolerance for finding other sources of capital, be they preferred or common that would allow you to move ahead with the recap plan? Or are we just going to have to kind of wait?
  Response: Timing is market-dependent. Third-party capital could be brought in, but the goal is to avoid high dilution; the company may sell liquid floaters to invest in more accretive opportunities.

• Question from Henry Coffey (Wedbush Securities): And then basically, just to kind of reiterate, the primary source of loans is going to be multifamily and what Genesis generates mainly higher-yielding repositioning loans? Or you'll be doing some more traditional multifamily lending as well inside of RPT?
  Response: The primary identified asset pool is around $1 billion of Genesis loans, which are levered well north of 15%, providing an immediate earnings pop; other loan types are possible but not specified.

• Question from Jason Stewart (Compass Point): Interesting opportunity at Genesis. Obviously, Genesis is not a forced seller. You do know the quality of the loans you're familiar with them. But could you talk about the pros and cons of buying from a Genesis versus a third party who might be more of a motivated or forced seller in the market?
  Response: The company sources from both Genesis and third parties; third-party demand is high, but credit quality is carefully monitored, with a preference for products where credit is sound.

• Question from Jason Stewart (Compass Point): You mentioned banks. I would have expected banks to have been sort of rate dislocated sellers in this market. Is that something you're seeing an opportunity to acquire, especially since it's multi? Or is that opportunity past?
  Response: Regional banks have pulled back, creating opportunities for Genesis and other lenders to grow production; banks are more buyers than sellers currently.

• Question from Jason Stewart (Compass Point): You mentioned the Fannie, Freddie licensing. Is the ultimate goal here to be able to go end-to-end sort of from an intermediate loan to permanent financing through the GSEs? Is that the vision for RPT down the road to have that license and create the customer relationship end-to-end?
  Response: Yes, the vision is to capture as much wallet share as possible from the customer base, creating an end-to-end franchise across lending, mortgage, and potential future products.

Contradiction Point 1

Nature of RPT's Investment in Paramount

Contradiction on whether the Paramount investment is debt or equity.

What are your thoughts on the recent partnership with Lucid Capital Markets, LLC? - Craig Kucera (Lucid Capital Markets, LLC)

2025Q4: RPT has a pro rata share of the Paramount deal, with $50 million on its balance sheet. - [Michael Nierenberg](CEO)

Will RPT receive a share of the $300 million NOI from the Paramount transaction at Rithm Capital, and how should we assess the earnings impact or accretion from this investment? - Craig Kucera (Lucid Capital Markets)

2025Q3: The Paramount deal is equity-based, not debt. RPT could invest around $50 million. - [Michael Nierenberg](CEO)

Contradiction Point 2

RPT's Appetite and Approach to Issuing Equity

Contradiction on the company's stance regarding future equity issuance.

What are your key takeaways from the recent earnings report? - Craig Kucera (Lucid Capital Markets, LLC)

2025Q4: The company has significant cash but does not anticipate issuing equity unless highly accretive. - [Michael Nierenberg](CEO)

Are you considering increasing Rithm's Genesis loan exposure, and what steps are being taken to align common stock value with book value? - Craig Kucera (Lucid Capital Markets)

2025Q3: The firm could raise the entire Paramount deal with third-party capital immediately, but the focus is on maximizing shareholder returns for RPT. - [Michael Nierenberg](CEO)

Contradiction Point 3

Primary Loan Sourcing Strategy

Contradiction on the primary source of loans for RPT.

What are your thoughts on the company's recent earnings performance? - Henry Coffey (Wedbush Securities Inc.)

2025Q4: The primary, identified pool of assets is around $1 billion in Genesis loans, which would immediately boost RPT earnings upon Board approval. - [Michael Nierenberg](CEO)

What is the primary source of loans for RPT: higher-yielding repositioning loans from Genesis or traditional multifamily lending? - Jason Michael Stewart (Janney Montgomery Scott LLC)

2025Q2: The pipeline includes a variety of assets: a retail asset in Seattle... opportunities in the multifamily space, some in the office sector, and larger M&A opportunities... The vehicle is currently intended to be a dedicated opportunistic commercial REIT. - [Michael Nierenberg](CEO)

Contradiction Point 4

Capital Deployment & Scaling Strategy

Contradiction on the method and timing for scaling the business and deploying capital.

What are your thoughts on the earnings report? - Craig Kucera (Lucid Capital Markets, LLC)

2025Q4: Genesis is expected to produce $6 billion to $7 billion in loans this year, with many going to Rithm's balance sheet and potentially to RPT post-capital raise... The path to equity value involves waiting for market stabilization... The company has significant cash but does not anticipate issuing equity unless highly accretive. - [Michael Nierenberg](CEO)

Are you considering providing additional Genesis loans to Rithm and what is the strategy to align common stock with book value? - Douglas Michael Harter (UBS Investment Bank)

2025Q2: Scaling will be driven by larger-scale transactions. Raising significant capital is difficult given the current stock price... so the strategy is to bring in third-party capital alongside the company in larger deals. - [Michael Nierenberg](CEO)

Contradiction Point 5

Strategy for Equity Value and Capital Raises

Contradiction on timing and method for equity value accretion.

What are your key takeaways from the recent earnings report? - Craig Kucera (Lucid Capital Markets, LLC)

2025Q4: The path to equity value involves waiting for market stabilization, as the stock trades at a discount to book value. The company has significant cash but does not anticipate issuing equity unless highly accretive. - [Michael Nierenberg](CEO)

Are you considering providing additional Genesis loans to Rithm, and what strategy will bring common stock closer to book value? - Douglas Harter (UBS)

2025Q1: The company is undervalued (trading at ~$2.85 vs. $5.40 book value). ... The preferred equity route was chosen to avoid dilution, and this path may be used again. - [Michael Nierenberg](CEO)