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1. Company Snapshot

1.a. Company Description

Walker & Dunlop, Inc., through its subsidiaries, originates, sells, and services a range of multifamily and other commercial real estate financing products and services for owners and developers of real estate in the United States.The company offers first mortgage, second trust, supplemental, construction, mezzanine, preferred equity, small-balance, and bridge/interim loans.It also provides multifamily finance for manufactured housing communities, student housing, affordable housing, and senior housing properties under the Fannie Mae's DUS program; and construction and permanent loans to developers and owners of multifamily housing, affordable housing, senior housing, and healthcare facilities.


In addition, the company acts as an intermediary in the placement of commercial real estate debt between institutional sources of capital, including life insurance companies, investment banks, commercial banks, pension funds, CMBS conduits, and other institutional investors, as well as owners of various types of commercial real estate.Further, it advises on capital structure; develops the financing package; facilitates negotiations between its client and institutional sources of capital; coordinates due diligence; and assists in closing the transaction.Additionally, the company offers property sales brokerage, underwriting and risk management, and servicing and asset management services.


Walker & Dunlop, Inc.was founded in 1937 and is headquartered in Bethesda, Maryland.

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1.b. Last Insights on WD

Walker & Dunlop's recent performance faced negative drivers, including a warning on data center oversupply from CEO Willy Walker, potentially impacting growth. Despite beating Q3 earnings and revenue estimates with $1.22 per share, concerns arose. A $192 million refinance deal for a multifamily portfolio indicates business activity. With a consensus "Moderate Buy" rating from analysts, investor sentiment remains cautiously optimistic. Institutional investors like Creative Planning and AXQ Capital LP adjusted their holdings, with Creative Planning decreasing its stake by 13.9%.

1.c. Company Highlights

2. Walker & Dunlop's Strong Q3 Earnings Reflect Improving Commercial Real Estate Market

Walker & Dunlop reported a robust third quarter, with revenues reaching $338 million, up 16% year-over-year, and diluted earnings per share of $0.98, a 15% increase. Adjusted EBITDA grew 4% to $82 million, while adjusted core EPS rose 3% to $1.22, beating analyst estimates of $1.21. The company's strong financial performance was driven by a 34% year-over-year increase in total transaction volume to $15.5 billion.

Publication Date: Nov -10

📋 Highlights
  • Total Transaction Volume:: Surged 34% YoY to $15.5 billion in Q3 2025, reflecting strong market demand.
  • Revenue and Earnings Growth:: Revenues rose 16% to $338 million, with diluted EPS up 15% to $0.98.
  • Investment Sales Volume:: Increased 30% YoY to $4.7 billion, outpacing industry growth of 17%.
  • At-Risk Servicing Performance:: Default rate of 21 basis points, with a $1 million provision for loan losses (vs. $2.9M prior year).

Capital Markets Momentum

The capital markets team continued to build momentum, delivering volume growth across every product offering. Loan origination fees grew 32%, property sales broker fees increased 37%, and MSR revenues rose 12% year-over-year. As noted by Greg Florkowski, "Over the past 2 years, we highlighted 2 trends in our GSE lending volumes. The first is a shift away from 10-year loan products towards shorter duration 5-year products." This shift is expected to drive future growth in cash origination fees and new mortgage servicing rights.

Investment Sales and Servicing Performance

Investment sales volume was very strong, up 30% to $4.7 billion, outperforming overall market growth of 17%. The at-risk servicing portfolio continues to perform exceptionally well, with only 10 defaulted loans totaling just 21 basis points. The company's credit fundamentals remain strong, with a default rate in CMBS portfolios of around 7%.

Growth Opportunities and Valuation

Walker & Dunlop is well-positioned for future growth, with a strong brand, large distribution network, and expanding service offerings. Analysts estimate revenue growth of 7.8% next year. The current P/E Ratio of 20.27 and P/S Ratio of 1.95 suggest that the market is pricing in moderate growth expectations. With a Dividend Yield of 3.83%, the stock offers an attractive income stream. However, the Net Debt / EBITDA ratio of 6.67 may raise concerns about the company's leverage.

Outlook

The company's strong Q3 earnings and improving commercial real estate market outlook position Walker & Dunlop for continued success. As Willy Walker noted, "We're a real estate capital markets pure play, and we're seeing the growth in capital markets transaction volumes coming back in 2025." With a robust pipeline of opportunities and a strong brand, Walker & Dunlop is poised to benefit from the growth in capital markets transaction volumes, particularly in 2026 and 2027.

3. NewsRoom

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Walker & Dunlop Arranges $153 Million for Multifamily Portfolio

Dec -02

Source: businesswire.com

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Creative Planning Has $1.30 Million Stock Holdings in Walker & Dunlop, Inc. $WD

Nov -29

Source: defenseworld.net

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Walker & Dunlop, Inc. (NYSE:WD) Receives Consensus Recommendation of “Moderate Buy” from Analysts

Nov -29

Source: defenseworld.net

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AXQ Capital LP Invests $249,000 in Walker & Dunlop, Inc. $WD

Nov -25

Source: defenseworld.net

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Contrasting Walker & Dunlop (NYSE:WD) and Freddie Mac (OTCMKTS:FMCC)

Nov -19

Source: defenseworld.net

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Walker & Dunlop Arranges $192 Million Refinance for Cortland Multifamily Portfolio

Nov -17

Source: businesswire.com

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Walker & Dunlop Arranges $625 Million Refinance for IMT Portfolio

Nov -10

Source: businesswire.com

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Walker & Dunlop, Inc. (WD) Q3 2025 Earnings Call Transcript

Nov -06

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (11.52%)

6. Segments

Servicing and Asset Management

Expected Growth: 12.0%

Walker & Dunlop's Servicing and Asset Management segment growth of 12.0% is driven by increasing demand for commercial real estate financing, expansion of the company's servicing portfolio, and strategic acquisitions. Additionally, the company's asset management capabilities and strong relationships with clients have contributed to the growth, as well as the increasing need for specialized servicing and asset management expertise in the commercial real estate industry.

Capital Markets

Expected Growth: 11.0%

Walker & Dunlop's 11.0% growth in Capital Markets is driven by increasing commercial property transactions, strong demand for multifamily and industrial properties, and expansion of its debt brokerage platform. Additionally, the company's strategic investments in technology and talent acquisition have enhanced its capabilities, further fueling growth.

Corporate Segment

Expected Growth: 10.0%

Walker & Dunlop's Corporate Segment growth of 10.0% is driven by increasing commercial property transactions, expansion of debt financing and servicing capabilities, and strategic investments in technology and talent. Additionally, the company's diversified revenue streams, strong relationships with borrowers and investors, and favorable market conditions also contribute to this growth.

7. Detailed Products

Multifamily Finance

Walker & Dunlop provides financing solutions for multifamily properties, including Fannie Mae, Freddie Mac, and FHA/HUD loans.

Commercial Property Sales

Walker & Dunlop offers investment sales services for commercial properties, including office, retail, industrial, and hospitality assets.

Capital Markets Advisory

Walker & Dunlop provides capital markets advisory services, including debt and equity placement, and financial restructuring.

Property Management

Walker & Dunlop offers property management services, including financial management, operational oversight, and asset management.

Appraisal and Valuation

Walker & Dunlop provides appraisal and valuation services for commercial properties, including multifamily, office, retail, and industrial assets.

Investment Management

Walker & Dunlop offers investment management services, including fund management and separate account management.

8. Walker & Dunlop, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Walker & Dunlop, Inc. operates in a highly competitive industry, but the threat of substitutes is mitigated by the company's diversified product offerings and strong brand recognition.

Bargaining Power Of Customers

Walker & Dunlop, Inc. has a large and diversified customer base, which reduces the bargaining power of individual customers. Additionally, the company's strong brand recognition and high-quality services reduce the likelihood of customers switching to competitors.

Bargaining Power Of Suppliers

Walker & Dunlop, Inc. relies on a network of suppliers to provide services and products, but the company's scale and bargaining power mitigate the risk of supplier concentration. However, the company is still exposed to supplier disruptions and price increases.

Threat Of New Entrants

The commercial real estate industry has high barriers to entry, including significant capital requirements and regulatory hurdles. Additionally, Walker & Dunlop, Inc.'s strong brand recognition and established relationships with customers and suppliers make it difficult for new entrants to gain traction.

Intensity Of Rivalry

The commercial real estate industry is highly competitive, with many established players competing for market share. Walker & Dunlop, Inc. faces intense competition from other industry leaders, which can lead to pricing pressure and reduced margins.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 61.38%
Debt Cost 6.70%
Equity Weight 38.62%
Equity Cost 11.55%
WACC 8.57%
Leverage 158.90%

11. Quality Control: Walker & Dunlop, Inc. passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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A-Score: 5.0/10

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Quality: 5.7

Yield: 6.0

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

63.23$

Current Price

63.23$

Potential

-0.00%

Expected Cash-Flows