Fintel reports that on August 14, 2023, RBC Capital maintained coverage of Two Harbors Investment (NYSE:TWO) with a Sector Perform recommendation.
Analyst Price Forecast Suggests 7.88% Upside
As of August 2, 2023, the average one-year price target for Two Harbors Investment is 14.50. The forecasts range from a low of 13.13 to a high of $16.80. The average price target represents an increase of 7.88% from its latest reported closing price of 13.44.
See our leaderboard of companies with the largest price target upside.
The projected annual revenue for Two Harbors Investment is 55MM, a decrease of 83.81%. The projected annual non-GAAP EPS is 2.51.
Two Harbors Investment Declares $0.45 Dividend
On June 21, 2023 the company declared a regular quarterly dividend of $0.45 per share ($1.80 annualized). Shareholders of record as of July 5, 2023 received the payment on July 28, 2023. Previously, the company paid $0.60 per share.
At the current share price of $13.44 / share, the stock's dividend yield is 13.39%.
Looking back five years and taking a sample every week, the average dividend yield has been 12.64%, the lowest has been 3.41%, and the highest has been 37.04%. The standard deviation of yields is 3.92 (n=236).
The current dividend yield is 0.19 standard deviations above the historical average.
Additionally, the company's dividend payout ratio is 8.24. The payout ratio tells us how much of a company's income is paid out in dividends. A payout ratio of one (1.0) means 100% of the company's income is paid in a dividend. A payout ratio greater than one means the company is dipping into savings in order to maintain its dividend - not a healthy situation. Companies with few growth prospects are expected to pay out most of their income in dividends, which typically means a payout ratio between 0.5 and 1.0. Companies with good growth prospects are expected to retain some earnings in order to invest in those growth prospects, which translates to a payout ratio of zero to 0.5.
The company's 3-Year dividend growth rate is 0.07%, demonstrating that it has increased its dividend over time.
What is the Fund Sentiment?
There are 409 funds or institutions reporting positions in Two Harbors Investment. This is an increase of 1 owner(s) or 0.25% in the last quarter. Average portfolio weight of all funds dedicated to TWO is 0.11%, a decrease of 11.97%. Total shares owned by institutions increased in the last three months by 19.25% to 74,614K shares. 
The put/call ratio of TWO is 1.22, indicating a bearish outlook.
What are Other Shareholders Doing?
IJR - iShares Core S&P Small-Cap ETF holds 7,022K shares representing 7.30% ownership of the company. In it's prior filing, the firm reported owning 6,432K shares, representing an increase of 8.40%. The firm decreased its portfolio allocation in TWO by 1.06% over the last quarter.
Allspring Global Investments Holdings holds 5,084K shares representing 5.29% ownership of the company. In it's prior filing, the firm reported owning 5,047K shares, representing an increase of 0.73%. The firm decreased its portfolio allocation in TWO by 8.07% over the last quarter.
ESPAX - Wells Fargo Special Small Cap Value Fund holds 4,089K shares representing 4.25% ownership of the company. In it's prior filing, the firm reported owning 3,191K shares, representing an increase of 21.97%. The firm increased its portfolio allocation in TWO by 16.79% over the last quarter.
VTSMX - Vanguard Total Stock Market Index Fund Investor Shares holds 2,951K shares representing 3.07% ownership of the company. In it's prior filing, the firm reported owning 2,605K shares, representing an increase of 11.72%. The firm decreased its portfolio allocation in TWO by 2.44% over the last quarter.
NAESX - Vanguard Small-Cap Index Fund Investor Shares holds 2,532K shares representing 2.63% ownership of the company. In it's prior filing, the firm reported owning 2,227K shares, representing an increase of 12.06%. The firm increased its portfolio allocation in TWO by 1.80% over the last quarter.
Two Harbors Investment Background Information
(This description is provided by the company.)
Two Harbors Investment Corp. is a Maryland corporation focused on investing, financing and managing residential mortgage-backed securities (RMBS) and related investments. Its objective is to provide attractive risk-adjusted returns to its stockholders over the long term, primarily through dividends and secondarily through capital appreciation. The Company selectively acquires and manages an investment portfolio of its target assets, which is constructed to generate attractive returns through market cycles. The Company focuses on security selection and implement a relative value investment approach across various sectors within the mortgage market. Its target assets include the following: Agency RMBS (which includes inverse interest-only Agency securities classified as Agency Derivatives for purposes of U.S. GAAP), meaning RMBS whose principal and interest payments are guaranteed by the Government National Mortgage Association (or Ginnie Mae), the Federal National Mortgage Association (or Fannie Mae), or the Federal Home Loan Mortgage Corporation (or Freddie Mac); Mortgage servicing rights (MSR); and Other financial assets comprising approximately 5% to 10% of the portfolio.
Additional reading:
- An Agency + MSR REIT Second Quarter 2023 Earnings Call AUGUST 1, 2023 Safe Harbor Statement 2 FORWARD-LOOKING STATEMENTS This presentation includes “forward-looking statements” within the meaning of the safe harbor provisions of the United States Pri
- Two Harbors Investment Corp. Reports Second Quarter 2023 Financial Results Benefitted From Attractive Spreads and Volatility Trending Lower
- An Agency + MSR Mortgage REIT First Quarter 2023 Earnings Call MAY 2, 2023 Safe Harbor Statement 2 FORWARD-LOOKING STATEMENTS This presentation includes “forward-looking statements” within the meaning of the safe harbor provisions of the United State
- Two Harbors Investment Corp. Reports First Quarter 2023 Financial Results Attractive Opportunities Ahead From Wide RMBS Spreads and Slow MSR Prepayment Speeds
- Subsidiaries of registrant. (filed herewith)
This story originally appeared on Fintel.
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