NEWT

ANALYST NOTE: NEWT (NewtekOne, Inc.) Date: 2026-06-13 Analyst: StoryStocks-Native Equity Research

1. Structural Readiness

Current State: Forming

• Current Price: $13.91
• Aggressive Entry (Pre-Breakout): $13.79
• Breakout Level (Resistance): $14.91
• Extension: None (Price is within the base range, not extended above the breakout level).
• Volatility Context: Current ATR is 3.5% (Productive). This sits within the historical "productive" range, suggesting sufficient volatility for a move without the elevated risk profile of extreme volatility (>8%).

2. Thesis Layer

Thesis Classification: TACTICAL / Setup-Led Macro Context: There is NO named secular thesis attached to this name as of 2026-06-13. The investment case is not driven by a broad macro theme (e.g., "AI Infrastructure" or "Green Energy Transition") but is strictly driven by the quality of the technical setup combined with the company's fundamental execution. Judgment Criteria: Conviction must be derived solely from the structural integrity of the coil formation and the verifiable business fundamentals reported in the evidence base. Do not invent a macro narrative to support the trade.

3. Business Overview

Company Profile: NewtekOne, Inc. operates as a financial holding company specializing in a comprehensive suite of business and financial solutions for independent business owners (SMBs). Business Model & Operations:

• Core Lending: The company is a leading provider of SBA 7(a) loans. As of the fiscal year 2026 (ending Sept 2026), Newtek Bank was the third-largest SBA 7(a) lender by dollar loan approval volume, approving over $355 million in the first 8 months of the fiscal year. In 2025, the company originated $767.8 million of SBA 7(a) loans, up from $943.0 million in 2024.
• Originations Momentum: Management reported strong momentum in early 2026. In Q1 2026, the company originated 961 loan units, a 40% year-over-year increase. March 2026 saw 500 units originated versus 287 in the prior year. This momentum continued into April with approximately 10% year-over-year growth.
• Securitization & Capital Efficiency: The company utilizes a securitization model to recycle capital. In January 2026, Newtek launched its fourth C&I LA securitization, selling $295 million in notes backed by $342 million in loans. Additionally, the company has a history of securitizing unguaranteed portions of SBA loans (13 securitizations from 2010 through June 2023).
• Diversified Revenue Streams: Beyond lending, the firm provides Newtek Banking, Newtek Payments (processing $5.2 billion in merchant transactions in 2025), Newtek Insurance, and Newtek Payroll. The company also originated C&I LA loans beginning in Q1 2026.
• Market Position: Management states NewtekOne is the largest SBA lender by units and top 2 or 3 by loan volume, targeting the 36 million independent business owners in the U.S. that represent 43% of U.S. GDP.

4. Archetype and Conviction

Archetype: Growth Leader Rationale: The company fits the "Growth Leader" archetype based on the documented acceleration in loan originations (40% YoY in Q1 2026) and the successful expansion into new product lines (C&I LA loans, expanded securitization). The business is not in a recovery phase but is actively scaling its market share and product suite. Valuation Context:

• Forward Consensus: The financial spine indicates a forward consensus EPS of $2.35714 for FY1 and $2.49857 for FY2.
• Management Guidance: In the April 30, 2026 earnings transcript, management reconfirmed a 2026 guidance midpoint of $2.35 and established a 2027 midpoint guidance of $2.60.
• Conviction Stack:
• *Thesis Strength:* Low (Tactical only).
• *Evidence Quality:* High (Multiple primary sources from earnings and SEC filings confirming growth and guidance).
• *Rerating Potential:* Dependent on the successful breakout above $14.91 and the market's reaction to the 2027 guidance of $2.60.
• ATR Analysis: The current ATR of 3.5% is "productive," indicating the stock has the necessary volatility to move but is not in the "extreme" danger zone (>8%) associated with severe losers.

5. Invalidations, Strengths, and Gaps

What Would Strengthen the Case:

• Technical: A daily close above $14.91 (Breakout Level) would confirm the coil, transitioning the setup to "Confirmed-Active."
• Fundamental: Confirmation that the April 2026 momentum (10% YoY growth) sustains through Q2, or the successful closing of the planned Q4 collateral pool event ($400M-$500M) mentioned by management.

What Would Invalidate the Case:

• Fundamental: A significant miss on the $2.35 2026 guidance or a reversal in loan origination volumes.

Evidence Gaps:

• Missing Evidence: None. The evidence base is complete regarding the setup parameters, recent earnings, and SEC filings.
• Missing Context: There is no specific data on the *current* credit quality (delinquency rates) of the 2026 loan book in the provided evidence, though the company's PLP status (Priority Lender Program) suggests operational maturity.

PRIVATE ANALYST CALL

Judgment: Speculative Confidence: medium Key risks: 1) Technical failure if price closes below $12.61; 2) Lack of a named secular thesis limits rerating potential; 3) Execution risk on the planned Q4 securitization collateral pool. Sizing hint: Position size should reflect the partial readiness of the forming coil; smaller than a confirmed breakout trade. Expected path: Management expects continued momentum in loan originations and the successful execution of the Q4 securitization event to support the $2.60 2027 guidance. Expected horizon: 3 to 6 months for the technical setup to resolve (breakout or invalidation). Failure mode to watch: A daily close below $12.61, which would invalidate the forming coil structure.