NewtekOne Inc. 8.625% Fixed Rate Senior Notes due 2029 (NEWTH)

FairStock Score: 41/100 — MIXED

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I look at NEWTH not as an equity but as a senior note of NewtekOne, a bank holding company that lends to small and medium businesses. At $25.17 on 2026-10-13, the notes sit near the top of their 52-week range of $24.50–$25.70, so I am paying a full price for an 8.625% coupon. The issuer earned $47.3M in fiscal 2023, $50.9M in fiscal 2024, and $60.5M in fiscal 2025, with diluted EPS of $1.88, $1.96, and $2.18. In the first half of 2026, net income was $13.4M in Q1 and $14.6M in Q2, with EPS of $0.43 and $0.47. That is progress, but FairStock’s Lynch category calls it a slow grower that has shrunk profits by 7.9% a year over four years, so the longer record is not clean. FairStock calculations show ROE of 17.13%, ROCE of 5.81%, D/E of 2.40, and P/B of 2.56. The 17% ROE is good, but 2.40 debt-to-equity means leverage is doing much of the work. More troubling, ROCE of 5.81% is below the 8.625% coupon; the business earns less on capital than these notes cost. The FairStock Score is 41/100. A senior note’s safety depends on the issuer’s ability to pay, not on growth. With leverage, a thin moat in SME lending, and a price near its high, the coupon compensates but does not provide a large margin of safety. I would want a lower price or evidence of consistently stronger coverage.

In plain English: NewtekOne is a bank holding company that lends to small and medium businesses and offers payment processing. The company has been profitable, and its net income grew from $47.3 million in fiscal 2023 to $60.5 million in fiscal 2025, but it carries a lot of debt relative to its equity. The 8.625% notes due 2029 are trading at $25.17, near the top of their 52-week range, so the price looks full rather than cheap for the interest payments.

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Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-06-30) · fiscal Q1 2026 10-Q (period ended 2026-03-31) · fiscal Q3 2025 10-Q (period ended 2025-09-30) · fiscal Q2 2025 10-Q (period ended 2025-06-30) · FY2025 10-K (period ended 2025-12-31) · FY2024 10-K (period ended 2024-12-31) · FY2023 10-K (period ended 2023-12-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer