The stock market was modestly higher on Thursday, with all three major indices up by less than 1% as of 1:50 p.m. EST. Commercial real estate finance company Walker & Dunlop (WD -0.21%) was a big standout, with shares climbing by 13%.
The short explanation is that Walker & Dunlop announced fourth-quarter and 2020 full-year earnings results before the market opened today, and investors are clearly impressed.
For starters, revenue climbed by 33% in 2020 to $1.08 billion, handily exceeding the $1 billion goal the company set in its 2015 five-year plan. Debt-financing volume shattered the company's $30 billion 2020 expectation as well, coming in at nearly $35 billion and growing 32% over 2019. And the company's mortgage-servicing portfolio is now a massive $107 billion in size, more than doubling in the past five years.
In Q4, Walker & Dunlop earned $2.59 per share, which is a staggering 93% year-over-year growth rate. Along with the earnings release, the company also announced a 39% increase in its quarterly dividend as well as a new $75 million share repurchase plan (up from $50 million in 2020).
Walker & Dunlop met most of its five-year goals set in 2015 despite the COVID-19 pandemic. The company recently released its new "Drive to '25" five-year plan, and it sets the ambitious goals of becoming the number one multifamily lender in the U.S., adding $60 billion in loans to the servicing portfolio, establishing investment banking capabilities, and more.
Walker & Dunlop has been an excellent investment over the past five years, but if the company can successfully meet its 2025 goals, there could be much more upside to come.