Is UWM Holdings a Buy?

The fortunes of mortgage bankers can shift pretty rapidly, and we may be in one of those periods of volatility right now. Last year, the industry benefited from a wave of refinancings as the Fed lowered interest rates as much as it could. At one point last fall, it looked like three-quarters of all outstanding mortgages could be profitably refinanced. Now that rates have risen dramatically since the beginning of the year, is this investment thesis officially dead? Are mortgage bankers like UWM Holdings (NYSE: UWMC) a buy?

Black Knight Financial put out an analysis last September (when the 30-year mortgage rate was 2.86%) that found 32.4 million borrowers could save 0.75% on their mortgage rate by refinancing. That is a tremendous amount of potential business. Since last fall, the yield on the 10-year Treasury note is up by more than 1 percentage point. What has happened to mortgage rates in general?