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Rithm Capital (LTS:0K76) Financial Strength : 2 (As of Jun. 2024)


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What is Rithm Capital Financial Strength?

Rithm Capital has the Financial Strength Rank of 2. It displays poor financial strength and is likely in financial distress. Usually this is caused by too much debt for the company.

Warning Sign:

Rithm Capital Corp displays poor financial strength. Usually, this is caused by too much debt for the company.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

GuruFocus does not calculate Rithm Capital's interest coverage with the available data. Rithm Capital's debt to revenue ratio for the quarter that ended in Jun. 2024 was 9.74. Altman Z-Score does not apply to banks and insurance companies.


Rithm Capital Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

Rithm Capital's Interest Expense for the months ended in Jun. 2024 was $-466 Mil. Its Operating Income for the months ended in Jun. 2024 was $0 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Jun. 2024 was $29,909 Mil.

Rithm Capital's Interest Coverage for the quarter that ended in Jun. 2024 is

The higher the ratio, the stronger the company's financial strength is.

2. Debt to revenue ratio. The lower, the better.

Rithm Capital's Debt to Revenue Ratio for the quarter that ended in Jun. 2024 is

Debt to Revenue Ratio=Total Debt (Q: Jun. 2024 ) / Revenue
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / Revenue
=(0 + 29908.918) / 3070.944
=9.74

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

Altman Z-Score does not apply to banks and insurance companies.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Rithm Capital  (LTS:0K76) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

Rithm Capital has the Financial Strength Rank of 2. It displays poor financial strength and is likely in financial distress. Usually this is caused by too much debt for the company.


Rithm Capital Financial Strength Related Terms

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Rithm Capital Business Description

Address
799 Broadway, New York, NY, USA, 10003
Rithm Capital Corp operates as a real estate investment trust that provides capital and services to the real estate and financial services industries. The company's mission is to generate attractive risk-adjusted returns in all interest-rate environments through a complementary portfolio of investments and operating businesses. Rithm Capital's investment portfolio is composed of mortgage servicing-related assets (full and excess MSRs and servicer advances), residential securities (and associated call rights) loans (including single-family rental), and consumer loans.