Loading...
•
Dec 31, 2022
Two Harbors Q4 2022 Earnings Report
Two Harbors reported positive return on book value due to being positioned in low coupon MSR and higher coupon RMBS.
Key Takeaways
Two Harbors Investment Corp. reported a positive return on book value in the fourth quarter of 2022, driven by its portfolio positioning in low coupon MSR and higher coupon RMBS. The company's book value was $17.72 per common share, and a dividend of $0.60 per share was declared. Comprehensive Income was $160.2 million, or $1.85 per share, and Earnings Available for Distribution (EAD) were $22.2 million, or $0.26 per share.
Reported book value of $17.72 per common share, and declared a fourth quarter common stock dividend of $0.60 per share, representing an 11.6% quarterly economic return on book value.
Generated Comprehensive Income of $160.2 million, or $1.85 per weighted average basic common share.
Reported Earnings Available for Distribution (EAD) of $22.2 million, or $0.26 per weighted average basic common share.
Generated Income Excluding Market-Driven Value Changes of $0.73 per weighted average basic common share.
Forward Guidance
The company did not provide specific forward guidance but expressed optimism about the return potential in 2023, expecting volatility to moderate, which could lead to tighter spreads and positive outcomes for mortgage securities.
Positive Outlook
- Constructive on forward-looking return potential in 2023
- Expects that volatility will moderate in 2023
- Tighter spreads could be a positive tailwind for mortgage securities
- Portfolio benefitting from being positioned in low coupon MSR
- Portfolio benefitting from being positioned in higher coupon RMBS
Challenges Ahead
- Spread volatility in the fourth quarter
- Challenging investment environments in decades
- Inflation moderated
- Rate expectations leveled off
Historical Earnings Impact
Analyze how earnings announcements historically affect stock price performance
Avg. Return Before/After Earnings
Loading earnings performance data...
Loading earnings reaction data...