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Mar 31, 2025
Two Harbors Q1 2025 Earnings Report
Two Harbors Investment Corp. reported its financial results for the first quarter of 2025, showing positive returns across its portfolio.
Key Takeaways
Two Harbors Investment Corp. delivered a strong first quarter in 2025, with both securities and Mortgage Servicing Rights (MSR) contributing to positive performance. The company reported a book value of $14.66 per common share and declared a common stock dividend of $0.45 per share, resulting in a 4.4% quarterly economic return on book value. Comprehensive Income reached $64.9 million.
Reported book value of $14.66 per common share, with a declared first quarter common stock dividend of $0.45 per share.
Achieved a 4.4% quarterly economic return on book value.
Generated Comprehensive Income of $64.9 million, or $0.62 per weighted average basic common share.
Settled $174.9 million in unpaid principal balance (UPB) of MSR through flow-sale acquisitions and recapture, with commitments to purchase an additional $1.7 billion UPB post quarter-end.
Revenue by Segment
Forward Guidance
The company is focused on maintaining low risk exposures in the uncertain macroeconomic environment, while also identifying opportunities from market dislocations.
Positive Outlook
- Thoughtful and intentional portfolio construction with MSR at its core is designed to deliver attractive risk-adjusted returns.
- RoundPoint, the mortgage operating company, provides additional benefits and allows impact on results through own actions.
- Maintaining high levels of excess liquidity, even as funding markets remain liquid and well supported.
- Agency RMBS spreads have widened, increasing levered returns available on that asset.
- Low weighted average coupon rate of MSR is expected to continue generating stable cashflows.
Challenges Ahead
- Uncertain macroeconomic environment necessitates focus on keeping risk exposures low.
- Lower notional mortgage exposure and lower spread exposure are being maintained.
- The company is subject to risks related to changes in interest rates and market value of assets.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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