The Mill Valley, California-based REIT posted net income of $18.3 million, or 13 cents per share, for the quarter ended Dec. 31. This performance marks a sharp reversal from the $7.7 million loss reported during the same period last year and comfortably exceeded the $13.2 million profit forecast by analysts polled by FactSet. Net interest income also saw a substantial lift, climbing to $25.9 million from $15 million a year earlier.

Following the announcement, Redwood Trust shares climbed to $6.68, having reached a 52-week high of $6.97 earlier in the trading session. The stock has now gained 4% over the past 12 months. The company’s book value per common share edged higher to $7.36 as of year-end, up from $7.35 at the close of the third quarter.

Driving Mortgage Momentum

Management attributed the quarterly success to sustained momentum across its mortgage banking platforms. The company reported that higher production revenue translated directly into earnings growth, with mortgage banking production reaching $7.3 billion. According to the earnings report, this operational scale served as the primary catalyst for the swing to profit as the firm capitalized on increased activity within its core lending channels.