NewtekOne, Inc. Depositary Shares, Non-Cumulative Perpetual Preferred Stock, Series B (NEWTP) Stock Analysis

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NewtekOne, Inc. Depositary Shares, Non-Cumulative Perpetual Preferred Stock, Series B (NEWTP) Financial Services Profile

NewtekOne, Inc. (NEWTP) is a business development company specializing in financial and business services for the SMB market. Operating through diverse segments like payment processing and small business finance, NewtekOne offers debt and equity investments. With a focus on strategic alliances and a dividend yield of 6.45%, the company aims to support small business growth.

What Is the Investment Thesis for NEWTP?

NewtekOne, Inc. presents a compelling investment case due to its focus on the underserved SMB market, offering diverse financial and technology solutions. The company's high dividend yield of 6.45% may attract income-seeking investors. With a P/E ratio of 4.90, the company may be undervalued relative to its earnings. Growth catalysts include expanding its technology solutions and strategic alliances. Potential risks include economic downturns impacting SMB loan performance and increased competition in the financial services sector. Investors should monitor the company's ability to maintain its profit margin of 17.6% and manage its beta of 1.28 in volatile market conditions.

Based on FMP financials and quantitative analysis

NEWTP Key Highlights

Market Cap of $427M indicating a mid-sized company within the asset management industry.

• P/E ratio of 4.90 suggesting the company's stock may be undervalued compared to its earnings.
• Profit Margin of 17.6% reflecting efficient operations and profitability.
• Gross Margin of 64.6% demonstrating strong pricing power and cost management.
• Dividend Yield of 6.45% offering an attractive income stream for investors.

Who Are NEWTP's Competitors?

NEWTP is benchmarked below against 8 industry peers on price, market cap, and our AI MoonshotScore.

AI Score by Stock Expert AI · Price data: FMP / Yahoo Finance

What Are NEWTP's Key Strengths?

Diversified service offerings including financial, technology, and insurance solutions.

• Strategic alliances with established organizations.
• Expertise in SBA loan origination.
• Integrated service platform providing a one-stop shop for SMBs.

What Are NEWTP's Weaknesses?

Reliance on the performance of the SMB market.

• Exposure to credit risk from SBA loans.
• Competition from larger financial institutions and technology providers.
• Potential impact from changes in government regulations.

What Could Drive NEWTP Stock Higher?

Expansion of managed technology solutions to capitalize on the growing demand among SMBs.

• Strategic alliances and partnerships to expand reach and offer bundled services.
• Potential acquisitions to enhance service offerings and market reach.
• Increased focus on e-commerce solutions to support SMB online growth.
• Geographic expansion to new markets within the United States.

What Are the Key Risks for NEWTP?

Financial-distress signal — its Altman Z-Score of 0.58 sits in the distress zone (elevated bankruptcy risk).

• Inconsistent delivery — missed Wall Street EPS estimates in 3 of the last 8 reported quarters.
• Weak fundamentals — a Piotroski F-Score of 2/9 flags soft profitability, leverage or efficiency.
• Economic downturns impacting SMB loan performance.
• Increased competition in the financial services and technology sectors.
• Changes in government regulations affecting SBA lending.
• Cybersecurity risks and data breaches.
• Interest rate fluctuations impacting loan profitability.

What Are the Growth Opportunities for NEWTP?

• Expansion of Managed Technology Solutions: NewtekOne can capitalize on the growing demand for managed technology services among SMBs. The global managed services market is projected to reach $356.24 billion by 2028. By expanding its offerings in website hosting, cybersecurity, and cloud services, NewtekOne can attract new clients and increase revenue. This expansion can be achieved through strategic acquisitions and partnerships, enhancing its competitive edge.
• Strategic Alliances and Partnerships: NewtekOne can leverage its existing alliances with companies like American International Group and Navy Federal Credit Union to expand its reach and offer bundled services. These partnerships can provide access to a broader customer base and create cross-selling opportunities. By forging new alliances with technology providers and financial institutions, NewtekOne can enhance its service offerings and strengthen its market position. The timeline for realizing these benefits is ongoing.
• Increased Focus on E-commerce Solutions: With the continued growth of e-commerce, NewtekOne can expand its e-commerce service offerings, including payment processing, online shopping cart tools, and website design. The global e-commerce market is expected to reach $6.2 trillion in 2024. By providing integrated e-commerce solutions, NewtekOne can help SMBs establish and grow their online presence, driving revenue growth and customer loyalty. This initiative can be implemented within the next 1-2 years.
• Expansion of Small Business Lending: NewtekOne can increase its origination of SBA loans to SMBs, capitalizing on the demand for capital among small businesses. The SBA lending market is supported by government guarantees, reducing the risk for lenders. By streamlining its loan application process and expanding its lending capacity, NewtekOne can attract more borrowers and increase its loan portfolio. This expansion can be achieved through strategic partnerships with community banks and credit unions. The timeline for this growth is ongoing.
• Geographic Expansion: NewtekOne can expand its operations to new geographic markets within the United States. By establishing offices in underserved areas and tailoring its services to local market needs, NewtekOne can attract new clients and increase its market share. This expansion can be achieved through a combination of organic growth and strategic acquisitions. The timeline for this expansion is within the next 3-5 years.

What Are NEWTP's Competitive Advantages?

• Integrated Service Platform: NewtekOne offers a comprehensive suite of financial and business services, creating a one-stop shop for SMBs.
• Strategic Alliances: Partnerships with established organizations like American International Group and Navy Federal Credit Union provide access to a broader customer base.
• SBA Lending Expertise: Specialization in SBA loan origination provides a competitive advantage in the small business lending market.
• Technology Solutions: Offering managed technology solutions enhances customer value and creates recurring revenue streams.

What Does NEWTP Do?

Founded in 1998 and converting to a BDC in 2014, NewtekOne, Inc. is headquartered in Boca Raton, Florida. The company focuses on providing financial and business services to the small- and medium-sized business (SMB) market in the United States. NewtekOne provides a range of services including: electronic payment processing, managed technology solutions, small business finance, and capcos. The firm also invests in early-stage businesses through debt and equity investments. Its debt investments include first lien loans (1-25 year terms), second lien loans (5-25 year terms), and unsecured loans (6-12 month terms). NewtekOne originates Small Business Administration (SBA) loans for commercial real estate, machinery, equipment, inventory, debt refinancing, franchises, working capital, and business acquisitions. The company also provides small business loan servicing and consulting services. Its electronic payment processing services include credit and debit card processing, check approval, eCommerce solutions, and electronic gift and loyalty card programs. NewtekOne offers technology solutions such as website hosting, web design, internet marketing, data storage, and e-commerce services. NewtekOne has strategic alliances with American International Group, CTAA, Navy Federal Credit Union, Credit Union National Association, and Pershing.

What Products and Services Does NEWTP Offer?

• Provides financial services to small and medium-sized businesses (SMBs).
• Offers Small Business Administration (SBA) loan origination.
• Provides electronic payment processing services.
• Offers managed technology solutions, including website hosting and data storage.
• Provides insurance products, including personal, commercial, and health/benefits lines.
• Offers payroll management processing and employee tax filing services.
• Invests in early-stage businesses through debt and equity investments.
• Offers account receivable financing.

How Does NEWTP Make Money?

• Generates revenue through fees from financial and business services provided to SMBs.
• Earns interest income from SBA loans and other debt investments.
• Receives commissions from insurance product sales.
• Generates revenue from technology solutions, including website hosting and e-commerce services.

What Industry Does NEWTP Operate In?

NewtekOne, Inc. operates within the asset management industry, which is characterized by increasing demand for specialized financial services for SMBs. The industry is competitive, with companies offering various lending, payment processing, and technology solutions. NewtekOne differentiates itself through its integrated platform and strategic alliances. Market trends include the growing adoption of digital payment solutions and the increasing need for SMBs to access capital and technology to compete effectively. The company's focus on SBA lending and technology solutions positions it to capitalize on these trends.

Who Are NEWTP's Key Customers?

• Small and medium-sized businesses (SMBs) across various industries.
• Early-stage businesses seeking debt and equity financing.
• Merchants requiring electronic payment processing services.
• Businesses needing managed technology solutions and support.
• Individuals and businesses seeking insurance products.

Company Profile

NewtekOne, Inc. Depositary Shares, Non-Cumulative Perpetual Preferred Stock, Series B operates in the Asset Management industry within the Financial Services sector. It is headquartered in Boca Raton, US. The company is led by CEO Barry Scott Sloane. NEWTP has traded publicly since 2025.

Return on equity for NewtekOne, Inc. Depositary Shares, Non-Cumulative Perpetual Preferred Stock, Series B stands at 16.3%, a gauge of how efficiently it converts shareholder capital into profit. Return on assets is 2.1%, showing how much profit it generates from its asset base. NEWTP trades at a trailing price-to-earnings ratio of 5.97, below the Financial Services sector average of ~18x. Its earnings yield is 16.8%, the inverse of the P/E and a quick read on earnings relative to price.

NEWTP Valuation & Market Position

With a $427M market cap, NewtekOne, Inc. Depositary Shares, Non-Cumulative Perpetual Preferred Stock, Series B sits in the small-cap segment of the market. Relative to its peer group, NEWTP's quantitative score of 50/100 is roughly in line with the peer average of 49/100.

Quarterly Financial Performance: NewtekOne, Inc. Depositary Shares, Non-Cumulative Perpetual Preferred Stock, Series B

Revenue for NewtekOne, Inc. Depositary Shares, Non-Cumulative Perpetual Preferred Stock, Series B came in at $95.2M during Q2 2026, a 29.9% improvement versus the preceding quarter. The company recorded net income of $14.6M, with diluted EPS of $0.47. Quarter-over-quarter revenue has been mixed, typical for a small-cap company operating in Financial Services. Across the four most recent quarters, NEWTP averaged $0.59 in diluted EPS.

NewtekOne, Inc. Depositary Shares, Non-Cumulative Perpetual Preferred Stock, Series B's Piotroski F-Score is 2/9, a 9-point checklist of profitability, leverage and efficiency — flagging fundamental weakness worth scrutiny. Its Altman Z-Score of 0.58 places it in the distress zone, a signal of elevated financial risk.

NewtekOne, Inc. Depositary Shares, Non-Cumulative Perpetual Preferred Stock, Series B has missed Wall Street's EPS estimate in 3 of its last 8 reported quarters — a mixed record worth weighing.

Wall Street analysts project NewtekOne, Inc. Depositary Shares, Non-Cumulative Perpetual Preferred Stock, Series B revenue of about $311.4M for fiscal 2026, with EPS near $2.22.

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Disclaimer: This content is for informational purposes only and does not constitute investment advice. Always do your own research and consult a financial advisor.

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