Given the structural changes in the mortgage industry, Nationstar Mortgage Holdings (NSM) is a fast-growing player in the servicing sector, according to analysts at investment bank FBR.

A direct example is its third quarter results, which showed a pipeline expansion of $600 billion in mortgage servicing.

With potential future portfolio wins of size of experience, the company estimates for fiscal year 2013 ESP is $3.80, posted FBR Capital. Nationstar is also predicted to grow $12 billion per quarter. 

The mortgage-banking component of the company is its rising star because it currently generates a majority of Nationstar’s bottom-line profit, given elevated gain-on-gain sale margins. 

FBR Capital reports that Nationstar also has an opportunity to continue the company’s servicing business growth by moving an available mortgage pool between $600 and $700 billion UPB in the industry. 

Various regulatory and policy initiatives – such as Basel III – could also continue to fuel Nationstar’s growth. The Office of inspector General and the Consumer Financial protection Bureau’s servicing standards help to strengthen non-bank servicers, leading to servicing capabilities in the market.

Nationstar’s platform has also benefited the Home Affordable Refinance Program 2.0, which accounts for 65% of originations. This provides well above averages for profit margins.