Velocity Financial's Dual Listing on NYSE Texas: A Strategic Move to Boost Liquidity and Market Visibility

In the ever-evolving landscape of real estate finance, strategic capital structuring has become a critical tool for firms seeking to scale and adapt. Velocity Financial, Inc. (NYSE: VEL), a vertically integrated real estate finance company, has recently taken a bold step by dual-listing its shares on NYSE Texas, a newly launched electronic exchange. This move is not merely a procedural adjustment but a calculated effort to enhance liquidity, diversify its investor base, and solidify its position in a high-growth sector. For investors, the implications are clear: Velocity's dual listing represents a compelling opportunity to capitalize on a company poised for long-term value creation.

The Strategic Logic of Dual Listings

Dual listings—where a company is listed on two exchanges simultaneously—have gained traction as firms seek to tap into regional economic strengths while maintaining access to broader markets. For real estate finance companies like Velocity, which operates in a capital-intensive industry, dual listings offer distinct advantages. By joining NYSE Texas, Velocity aligns itself with a market that boasts a $2.7 trillion economy, a robust business-friendly environment, and a growing population. This strategic pivot allows the company to attract Texas-based institutional and retail investors, many of whom may have previously overlooked a firm primarily listed on the NYSE.

The benefits extend beyond geography. NYSE Texas, built on the same Pillar technology as the NYSE, offers lower latency and streamlined order execution, which can enhance trading efficiency for both the company and its shareholders. For Velocity, this means greater liquidity for its shares, reducing the risk of price volatility and making it easier for investors to enter or exit positions. The exchange's focus on supporting derivatives trading and institutional networks further amplifies its appeal, particularly for firms like Velocity that rely on sophisticated capital structures.

Capital Access and Investor Appeal

Velocity's dual listing is underpinned by its strong financial performance, which has made it an attractive candidate for expanded market access. In Q2 2025, the company reported a 75.9% year-over-year increase in net income to $26.0 million, driven by a 71.8% surge in loan production to $725.4 million in unpaid principal balance (UPB). Its net interest margin (NIM) improved to 3.82%, a 47-basis-point increase from the prior quarter, while nonperforming loans as a percentage of the portfolio declined to 10.3%. These metrics underscore Velocity's ability to generate consistent returns and manage risk effectively—qualities that resonate with both traditional and alternative investors.

The dual listing also aligns with broader trends in real estate finance. As global real estate fundraising faces headwinds, firms that can demonstrate operational expertise and disciplined capital deployment are gaining traction. Velocity's focus on business-purpose loans for 1-4 unit residential rentals and small commercial properties positions it to capitalize on underserved markets, particularly in high-growth regions like Texas. By listing on NYSE Texas, the company not only reinforces its local presence but also signals its commitment to transparency and governance, which are increasingly important to ESG-conscious investors.

Market Diversification and Long-Term Value Creation

One of the most compelling arguments for Velocity's dual listing is its potential to mitigate market concentration risks. Historically, real estate finance firms have been heavily reliant on the NYSE or Nasdaq, exposing them to liquidity constraints during periods of market stress. By diversifying its listing venues, Velocity reduces its vulnerability to regional or sector-specific shocks. This is particularly relevant in today's macroeconomic climate, where inflationary pressures and regulatory shifts are reshaping capital flows.

Moreover, the dual listing enhances Velocity's ability to execute its long-term growth strategy. The company has set an ambitious target of expanding its loan portfolio to $10 billion over the next five years. Access to a broader pool of capital—especially from Texas-based investors—will be critical to achieving this goal. The recent completion of four securitizations totaling $985.5 million in Q2 2025, which reduced its recourse debt-to-equity ratio to 1.0x, demonstrates Velocity's capacity to leverage its balance sheet effectively. With the dual listing, the company is well-positioned to maintain its momentum while offering investors a diversified and resilient investment vehicle.

A Call to Action for Investors

For investors, the dual listing of Velocity Financial on NYSE Texas presents a timely opportunity. The stock has already shown resilience, closing at $18.84 on August 12, 2025, with a 5.25% gain for the day, despite a 1.03% dip following its Q2 earnings report. This volatility reflects the market's cautious optimism, but the fundamentals suggest a stronger trajectory. Velocity's five-year return of 380.61% and a trailing P/E ratio of 8.52 indicate that the stock is undervalued relative to its growth potential.

Investors should also consider the broader context. As real estate fundraising struggles to recover from a three-year slump, firms with innovative capital structures and strong operational execution are outperforming peers. Velocity's dual listing, combined with its strategic focus on Texas—a state with a 3.5% population growth rate and a thriving commercial real estate market—positions it to benefit from demographic and economic tailwinds.

Conclusion

Velocity Financial's dual listing on NYSE Texas is more than a procedural milestone; it is a strategic masterstroke that enhances liquidity, broadens investor appeal, and reinforces long-term value creation. For investors seeking exposure to a resilient real estate finance model, the company's shares offer a compelling case. The key is to act now, before the market fully recognizes the implications of this move. In an era of fragmented capital markets and shifting investor priorities, Velocity's dual listing is a testament to the power of strategic agility—a lesson that every investor would do well to heed.