Cherry Hill Mortgage swings to Q3 net loss on unrealized RMBS losses

Overview

• U.S. mortgage REIT posted Q3 net loss and loss per share of $0.11

• Earnings available for distribution for Q3 were $0.14 per share

• Company highlighted pending merger with TPG Mortgage Investment Trust, announced in August

Outlook

• Company has entered into a definitive merger agreement with TPG Mortgage Investment Trust, Inc.

Result Drivers

• RMBS LOSSES - Co said net unrealized loss on RMBS and credit loss and impairment on other assets contributed to Q3 net loss

• DERIVATIVES GAINS - Realized and unrealized gains on derivatives partially offset portfolio losses in Q3

• SERVICING INCOME - Net servicing fee income supported earnings available for distribution in Q3

Company press release:

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is no "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the specialized reits peer group is "buy."

• Wall Street's median 12-month price target for Cherry Hill Mortgage Investment Corporation is $3.10, about 19.7% above its October 28 closing price of $2.59

• The stock recently traded at 5 times the next 12-month earnings vs. a P/E of 4 three months ago

Reuters Recommended Reads

• Oct 26 - TPG RE Finance Trust Q3 distributable earnings fall on realized loan loss

• Oct 29 - Blackstone Mortgage Trust posts Q3 loss

• Oct 28 - KKR Real Estate Finance Trust posts smaller Q3 loss on strong loan repayments

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)