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Thu, Feb. 4, 12:48 PM
Thu, Feb. 4, 9:45 AM
- "PMTs investment returns underperformed our expectations in the fourth quarter due to a combination of factors, the largest of which was reduced earnings from our distressed loan portfolio driven by higher yield requirements and lower home prices versus prior forecasts," says CEO Stan Kurland. The distressed mortgage portfolio yielded gains of just $2M in Q4 vs. $31.9M in Q3.
- Net income of $15.7M fell 60% from Q3; per share of $0.21 fell 57%. Net investment income of $50.6M fell 44%.
- Book value per share of $20.28 slipped from $20.52.
- Investment Activities segment yielded a quarterly loss of $6.131M vs. a profit of $34.9M in Q3.
- The MSR portfolio grew to $42.3B in UPB from $39.9B.
- Correspondent Production segment looks better, with pretax income of $13.1M vs. $10.2M in Q3.
- The conference call comes at 4:30 ET
- Previously: PennyMac Mortgage reports Q4 results (Feb. 3)
- PMT -15.4% to $11.58.
Wed, Feb. 3, 5:12 PM
Tue, Feb. 2, 5:35 PM
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Wed, Jan. 20, 9:54 AM
- Unbridled selling of the mortgage-related names continues in today's session.
- A sampling: PennyMac (PMT -3.9%), Ocwen (OCN -12.8%), Walter Investment (WAC -1.4%), Nationstar Mortgage (NSM -4.3%), New Residential (NRZ -3.8%), Altisource Portfolio (ASPS -12.2%).
- There's a general market panic going on, but there's also a plunge in interest rates which lowers the value of servicing portfolios as it makes refinancings more likely. Indeed, the MBA earlier today reported a 19% increase in mortgage refis last week.
- Owcen and New Residential come to mind as two with active buyback programs in place.
Tue, Jan. 19, 11:43 AM
- The best thing that can be said about the market reaction today, is that New Residential (NRZ -0.6%) isn't down as much as the other mortgage-related names (REM -1.8%) which continue to be mercilessly pounded.
- PennyMac (PMT -4.5%), Ocwen (OCN -3.7%), Walter Investment (WAC -4.8%), Stonegate (SGM -3.4%), Armour (ARR -3.5%), Invesco (IVR -2.4%), New York Mortgage (NYMT -4.1%), Apollo Residential (AMTG -3.1%), AG Mortgage (MITT -3.4%), Five Oaks (OAKS -6.7%), American Capital (MTGE -2%), Two Harbors (TWO -2.2%), Chimera (CIM -3.4%).
- Citi's Michael Kaye - who rates NRZ a Buy - says the repurchase plan makes sense given the stock trades at just 0.84x book and yields 18%. Depending on how the buyback is funded, it could add up to a couple of hundred basis points of accretion. It also sends a signal to the markets about management's belief in the stock's value. Management gave little detail on a timetable.
- Previously: New Residential steps in with $200M repurchase plan (Jan. 19)
Wed, Jan. 13, 1:14 PM
- It wasn't supposed to be this way after the Fed embarked on a rate hike cycle as these yield-starved names could finally look forward to earning a better spread on their money.
- Since the Fed hiked last month, however, the long bond yield has tumbled about 20 basis points, further narrowing the yield curve.
- With today's 1.3% decline, the XLF is lower by 7.6% YTD, about 200 basis points worse than the S&P 500 (but about 250 basis points better than the energy sector).
- TBTFs: Morgan Stanley (MS -3.9%), Goldman Sachs (GS -2.3%), Citigroup (C -1.8%)
- Regionals: U.S. Bancorp (USB -2%), Regions Financial (RF -3.4%), New York Community Bancorp (NYCB -2.2%)
- Mortgage-related names like Ocwen (OCN -6.2%), Nationstar (NSM -5.3%), Walter Investment (WAC -13.9%), and New Residential (NRZ -5.3%) have come in for particular punishment this day and this year. The mortgage REITs too: Hatteras Financial (HTS -4.4%), Western Asset (WMC -3.6%), New York Mortgage (NYMT -2.3%), Five Oaks (OAKS -5.2%), PennyMac (PMT -2.6%)
- ETFs: XLF, FAS, FAZ, UYG, VFH, IYF, BTO, SEF, IYG, FXO, FNCL, FINU, RWW, RYF, FINZ, XLFS
Tue, Jan. 12, 3:17 PM
- The 10-year Treasury yield is off eight basis points on the session at 2.10%, and now lower by about 20 basis points since the Fed Funds rate got hiked 25 basis points less than a month ago - probably not the best scenario for mREIT earnings going forward.
- Other income favorites like equity REITs, BDCs, and utilities (XLU -0.8%) are also being aggressively sold today.
- Annaly Capital (NLY -1.8%), American Capital Agency (AGNC -1.7%), Armour Residential (ARR -2.4%), Two Harbors (TWO -2%), CYS Investments (CYS -1.9%), Invesco (IVR -2.3%), New York Mortgage (NYMT -2.3%), Hatteras (HTS -3.2%), Capstead (CMO -3.6%), Western Asset (WMC -2.9%), Apollo Residential (AMTG -3.6%), Dynex (DX -3.1%), Ellington Residential (EARN -3.5%), AG Mortgage (MITT -3.2%), PennyMac (PMT -4.9%), FIve Oaks (OAKS -5.7%)
- ETFs: MORL, REM, MORT, LMBS
Wed, Jan. 6, 9:49 AM
- Douglas Harter and team's top picks are those companies with operating businesses that can create their own investments: New Residential (NYSE:NRZ), PennyMac Mortgage (NYSE:PMT), Starwood Property (NYSE:STWD), and Two Harbors (NYSE:TWO).
- As for the names best-insulated from what's likely to be a series of rate hikes, Harter likes Starwood and Ares Commercial Real Estate (NYSE:ACRE).
- Looking more generally at the sector, Harter notes stocks on average are trading at a 25% discount to book value, meaning the risks from higher rates may already be baked in. While not seeing any catalyst to drive valuations higher, the average 14.7% dividend yield should provide a nice return.
- ETFs: MORL, REM, MORT, LMBS
Dec. 10, 2015, 4:33 PM
Dec. 10, 2015, 10:32 AM
- The roughed-up mortgage sector sees some dip-buying as Barclays initiates coverage on PennyMac Mortgage Investment (PMT +3.5%) and PennyMac Financial Services (PFSI +0.9%) with Overweight ratings.
- The $21 price target on PMT is a 36% upside to last night's close. The $20 PT on PFSI represents 25% upside.
Nov. 24, 2015, 2:02 PM
- Consolidation in the servicer industry had been the norm prior to the housing crisis, with the market share of the top five at 59% in 2009 vs. 37% in 2001. In Q2 of this year, that market share had slipped to 40%. Nonbanks accounted for 9% of servicing in 2009, and 19% by 2014.
- With post-crisis increases in regulatory and counterparty oversight, significant boosts in costs to service mortgages (particularly NPLs), and new capital rules making it more costly to hold MSRs, it only makes sense for consolidation to return.
- Interested parties: PennyMac Mortgage (NYSE:PMT), Ocwen Financial (NYSE:OCN), Nationstar Mortgage (NYSE:NSM), New Residential (NYSE:NRZ), Altisource Portfolio (NASDAQ:ASPS), Walter Investment (NYSE:WAC).
Nov. 4, 2015, 4:59 PM
- PennyMac Mortgage (NYSE:PMT): Q3 EPS of $0.49
- Investment income of $90.77M (-14.6% Y/Y)
Nov. 3, 2015, 5:35 PM
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Oct. 7, 2015, 11:15 AM
- So roughed up are the mortgage REITS (REM +0.7%), that what's now a six-day rally in the sector is little more than a blip on the longer-term chart.
- There's no particular news today, but with much of the sector trading at somewhere in the area of a 15-20% or even higher discounts to book value, even the worst scenario on interest rates may be more than priced in.
- Leading the way higher today are Ellington Residential (EARN +4.3%), Javelin Mortgage (JMI +3.4%), Arlington Asset (though not a REIT) (AI +2.3%), Dynex Capital (DX +0.9%), Apollo Residential (AMTG +1.2%), PennyMac Mortgage (PMT +1%), Cherry Hill Mortgage (CHMI +1.2%), Hatteras Financial (HTS +0.5%), Two Harbors (TWO +0.8%). The action in Annaly Capital (NLY) and American Capital Agency (AGNC -0.3%) is more subdued.
- ETFs: MORL, REM, MORT, LMBS
Sep. 22, 2015, 8:09 AM
- PennyMac Mortgage (NYSE:PMT) declares $0.47/share quarterly dividend, -23% decrease from prior dividend of $0.61.
- Forward yield 11.52%
- Payable Oct. 29; for shareholders of record Oct. 15; ex-div Oct. 13.
PennyMac Mortgage Investment Trust is a real estate investment trust investing in residential mortgage loans and mortgage-related assets. The Company operates in two segments: correspondent production and investment activities.
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