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Sep 30, 2021
Invesco Mortgage Capital Q3 2021 Earnings Report
Announced financial results for the quarter ended September 30, 2021
Key Takeaways
Invesco Mortgage Capital Inc. reported net income per common share of $0.17 and earnings available for distribution per common share of $0.10 for Q3 2021. The book value per common share increased to $3.25, resulting in an economic return of 4.0%. The company's investment portfolio was primarily invested in Agency RMBS, with a sizeable balance of unrestricted cash and unencumbered investments.
Net income per common share was $0.17, compared to a net loss per common share of $0.34 in Q2 2021.
Earnings available for distribution per common share was $0.10, unchanged from Q2 2021.
Common stock dividend was $0.09 per common share, unchanged from Q2 2021.
Book value per common share was $3.25, compared to $3.21 at Q2 2021.
Forward Guidance
The company anticipates a reduction in Agency RMBS purchases by the Federal Reserve, but expects diminishing supply and continued demand from commercial banks to support valuations. They continue to evaluate additional investment opportunities to complement their Agency RMBS strategy by expanding target assets and diversifying their risk profile.
Positive Outlook
- Slowing prepayment speeds led to increased demand in higher coupon 30 year collateral.
- Continued demand from commercial banks should support valuations in the coming months.
- Evaluating additional investment opportunities to complement Agency RMBS strategy.
- Expanding target assets to diversify risk profile.
- Maintaining a sizable balance of unrestricted cash and unencumbered investments totaling $787.6 million.
Challenges Ahead
- Lower coupons underperformed as the Federal Reserve signaled it will begin tapering asset purchases later this year.
- Reduction in asset purchases could result in an increase in market volatility.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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