Nov. 19, 2014, 3:42 PM
- A check of the mortgage REITs following FOMC minutes which shows the discussion moving a bit more seriously towards rate hikes finds the sector (REM -0.5%) modestly lower.
- Individual names: Annaly (NLY -0.3%), American Capital Agency (AGNC), CYS Investments (CYS -0.3%), Invesco Mortgage (IVR -0.9%), New York Mortgage Trust (NYMT -0.4%), Hatteras Financial (HTS -0.8%), MFA Financial (MFA -1%), Capsteam Mortgage (CMO -0.6%), Ellington Residential (EARN -0.4%).
Nov. 10, 2014, 7:23 AM
- Q3 core earnings of $6.9M or $0.76 per share vs. $6.8M and $0.75 in Q2. Dividend is $0.55.
- Book value per share of $18.53 vs. $18.71 at end of Q2. Friday's close of $17.68 is a 4.6% discount to September 30 book, a sizable narrowing from the double-digit discounts available to buyers over much of the past several quarters.
- Net interest margin of 2.38% up five basis points from Q; CPR of 5.3% up 130 basis points.
- Non-agency MBS portfolio trimmed just a bit to $33.7M from $35.7M.
- Conference call at 11 ET
- Previously: Ellington Residential Mortgage REIT EPS of $0.76
- EARN flat premarket
Nov. 10, 2014, 7:16 AM
Oct. 7, 2014, 7:08 AM
Sep. 30, 2014, 3:45 PM
- Nearing the end of the day at the JMP Financial Services and Real Estate Conference, attendees get a two-fer, with Michael Vranos and Lawrence Penn presenting for both Ellington Financial (EFC -0.1%) and Ellington Residential (EARN -1.8%).
- Webcast and presentation slides
- "We are religious interest rate hedgers," says Penn (the CEO of both). Our edge, he says, is not in predicting the direction of interest rates. He notes EFC lost just 1% of book value in its agency portfolio and EARN (which is strictly agency MBS) lost only 3% ... "orders of magnitude" less than the company's industry peers.
- EFC hedges credit as well, says Penn, and he notes the company made money during brutally tough years - 2008/09 and 2011 - for credit.
- Previously: Mortgage REITs slip amid investor presentations
Sep. 17, 2014, 2:51 PM
- Another $10B taper this month brings QE to just $5B monthly, an amount the FOMC expects to go down to zero with its next policy meeting. The "dots" shifted somewhat higher - meaning maybe a slightly earlier start to Fed rate hikes and a higher level of Fed Funds at the end of the next few years, with the median forecast being 2.9% at the end of 2016.
- Mortgage REITs (REM +0.2%) have been under pressure in the sessions ahead of the FOMC, and are mostly snoozing through today's news.
- Annaly (NLY -0.1%), American Capital Agency (AGNC +0.1%), CYS Investments (CYS +0.2%), New York Mortgage Trust (NYMT +0.5%), Dynex (DX +0.8%), Ellington Residential (EARN +1.2%), Javelin (JMI +1.3%).
- Previously: FOMC statement and projections lean hawkish
- Previously: Yellen press conference: Falling UE rate still masking labor market weakness
Sep. 11, 2014, 4:36 PM
Aug. 12, 2014, 7:37 AM
- Q2 core earnings of $6.8M or $0.75 per share vs. $7M and $0.77 in Q1. Dividend is $0.55.
- Book value of $18.71 per share vs. $18.05 at end of Q1. Last night's close of $16.82 is a 10.1% discount to book.
- Net interest margin of 2.33% is off one basis point from Q1. CPR of 4% up from 2.2%.
- Noting the pleasing rise in RMBS prices in Q2, management believes continued Fed tapering and a potential rise in mortgage originations could ultimately pressure valuations. The team continued to add interest rate hedges during Q2, taking what it hopes to be a temporary hit to profits.
- Conference call at 11 ET
- EARN flat premarket
- Previously: Ellington Residential Mortgage REIT EPS of $0.75
Aug. 11, 2014, 5:04 PM
Jul. 3, 2014, 9:56 AM
- A few days ago, the 10-year Treasury yield stood at about 2.50%, but it's been on the rise all week and shot up to near 2.7% this morning following the strong jobs print and drop in unemployment to 6.1%. Checking the short end of the curve, Eurodollar futures are selling off as well, and now have baked in more than one rate hike between now and one year from now, and 75 basis points of hikes by the end of 2015.
- Previously: Treasury yields jump, gold slumps after strong jobs print
- Off 1.1% today, Annaly Capital (NLY) is down nearly 5% since this time last week, with a similar move having taken place in American Capital Agency (AGNC -1.2%).
- Chimera (CIM -1.4%), CYS Investments (CYS -1%), Invesco Mortgage (IVR -1.8%), American Capital Mortgage (MTGE -1.6%), New York Mortgage Trust (NYMT -1.2%), AG Mortgage (MITT -1.8%), Ellington Residential (EARN -0.7%), Dynex (DX -0.8%), MFA Financial (MFA -0.9%).
- ETFs: REM, MORT, MORL
Jun. 17, 2014, 4:33 PM
Jun. 3, 2014, 10:50 AM
- "Our core belief is that we do not know where interest rates are going," says Ellington Management (EFC, EARN) presenting at KBW.
- Presentation slides and webcast
- He notes both Ellington Financial (EFC) and Ellington Residential (EARN) cruised through the sharp rise in interest rates last year, with book values remaining largely intact. While EFC's portfolio is 85% non-agency & credit plays and 15% agency, EARN is the flip, with 85% agency and 15% non-agency.
- EFC's current dividend yield is 12.8% and management expects the quarterly payout of $0.77 to continue. The board will consider a special dividend at the end of the year.
- Other notes: Ellington's been talking about investing in an origination platform for about a year, and, now that mortgage originations look to have bottomed, that day appears to be getting closer. "The market is coming to us." By the end of the year, says the team, odds are good Ellington will have stakes in one or two originators.
May 13, 2014, 8:03 AM
- Core earnings of $7M or $0.77 per share vs. $6.8M or $0.74 in Q4. Dividend of $0.55.
- March 31 book value of $18.05 per share slips from $18.29 on December 31 after payment of dividend. Much of the sizable discount to book has been narrowed as yesterday's close was $17.11.
- Net interest margin of 2.34% up 17 bps; CPR of 2.2% in unchanged; leverage of 7.8:1 about unchanged.
- "The Company remains generally positive in its outlook for non-Agency RMBS, both on fundamental and technical grounds."
- No share repurchases during quarter
- CC at 11 ET
- Source: Press Release
- Previously: Ellington Residential Mortgage REIT EPS of $0.77
- EARN no trades premarket
May 12, 2014, 6:45 PM
Apr. 29, 2014, 12:12 PM
- The mortgage REIT (REM -0.9%) sector is lower following American Capital Agency Q1 results from after the bell last night. Earnings beat expectations and comfortably covered the $0.65 dividend, but a 2.3% gain in book value may have been somewhat shy of what was hoped for.
- Opinions make markets, and - unlike CYS Investments' management - American Capital CIO Gary Kain does not view the current mortgage market as too pricey to play in.
- Also for fixed income investors to chew on is Apple's upcoming (bell-ringing?) massive debt offering.
- Related ETFs: MORT, MORL.
- Other agency (or mostly so) MBS names: Annaly (NLY -0.7%), Armour (ARR -0.1%), Hatteras (HTS -0.1%), Capstead (CMO), Anworth (ANH -0.2%), Ellington Residential (EARN -0.6%).
Apr. 9, 2014, 2:43 PM
- Mixed earlier, a lot more green creeps into the mortgage REIT sector (REM +0.6%) after the FOMC minutes suggest members aren't in as quite of a rush as thought to hike rates. The 10-year note yield is back to flat on the session at 2.68% (was as high as 2.72% pre-release), and the short end is doing even better (steeper curve) with the Dec. 2015 Eurodollar contract higher by six basis points.
- Leading the move higher are American Capital Agency (AGNC +1.1%), Chimera Investment (CIM +1.1%), and Hatteras Financial (HTS +1%). Also among those ahead are Annaly (NLY +0.7%), Anworth (ANH +0.6%), Ellington (EFC +1.3%), (EARN +0.1%), and Javelin (JMI +0.6%).
- Related ETFs: MORT, MORL
EARN vs. ETF Alternatives
Ellington Residential Mortgage REIT is engaged in acquiring, investing in, and managing residential mortgage and real estate-related assets. It is also engaged in constructing & actively managing a portfolio comprised mainly of Agency RMBS.
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