Dynex Capital's Q3 book value declines, reports loss

By Reuters News


Overview

  • U.S. mortgage REIT reported a sequential drop in Q3 book value per share and a net loss

  • Book value fell as wider agency MBS spreads pressured asset valuations

  • Company raised $384 mln capital and expanded agency MBS portfolio by $3.2 bln


Outlook

  • Company says current Agency mortgage market offers attractive forward return opportunities

  • Company sees stable financing and strong technical conditions in the mortgage market


Result Drivers

  • MBS SPREAD WIDENING - Co said wider agency MBS spreads drove decline in book value and asset valuations, partially offset by gains on interest rate hedging portfolio

  • PORTFOLIO GROWTH - Higher interest income attributed to increased capital deployment into agency MBS and 10% growth in average interest-earning assets

  • EXPENSE REDUCTION - Operating expenses fell due to lower stock-based compensation


Company press release:


Key Details

Metric

Beat/Miss

Actual

Consensus Estimate

Q3 Loss Per Share

$1.34

Q3 Net Interest Income

$101.56 mln


Analyst Coverage

  • The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 4 "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 Dynex Capital, Inc. is $14.50, about 32.7% above its October 16 closing price of $10.93

  • The stock recently traded at 7 times the next 12-month earnings vs. a P/E of 8 three months ago


Reuters Recommended Reads

  • Oct 16 - Ames National Q3 profit jumps as wider interest margin lifts income

  • Oct 16 - US regional banks join bigger peers in signaling resilient economy as lending holds firm

  • Oct 18 - UK housing market showing signs of mortgage rates impact, Rightmove says


For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.


(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.)

Capital.com is an execution-only brokerage platform and the content provided on the Capital.com website is intended for informational purposes only and should not be regarded as an offer to sell or a solicitation of an offer to buy the products or securities to which it applies. No representation or warranty is given as to the accuracy or completeness of the information provided.

The information provided does not constitute investment advice nor take into account the individual financial circumstances or objectives of any investor. Any information that may be provided relating to past performance is not a reliable indicator of future results or performance.

To the extent permitted by law, in no event shall Capital.com (or any affiliate or employee) have any liability for any loss arising from the use of the information provided. Any person acting on the information does so entirely at their own risk.

Any information which could be construed as “investment research” has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication.