Two Harbors Q2 swings to profit as CCM merger nears close - TWO News | RalliesTwo Harbors Q2 swings to profit as CCM merger nears close
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TWO• Drivers of the quarter
- Gains on derivative instruments helped offset fair value losses on servicing assets and investment securities.
- Operating expenses included $13.6 million in merger-related costs during Q2.
- The company reduced agency RMBS holdings and added $186.5 million in MSR through acquisitions and recapture.
Analyst and valuation snapshot
- The current average analyst rating on the shares is hold, with no strong buy or buy ratings, 8 hold ratings and 1 sell or strong sell rating.
- The average consensus recommendation for the specialized REITs peer group is buy.
- Wall Street's median 12-month price target for Two Harbors Investment Corp is $12.00, about 1% below its July 27 closing price of $12.12.
- The stock recently traded at 11 times the next 12-month earnings, versus a P/E of three months ago.
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Q2 profit and dividend details
- U.S. MSR-focused REIT's Q2 comprehensive income rose to $47.9 million, reversing a prior loss.
- Earnings available for distribution fell to $0.28 per share from $0.34 in Q1.
- The company declared a stub period dividend of $0.12196 per share for Q3 2026, subject to merger completion.
Merger with CrossCountry Mortgage
- Shareholders approved the merger with CrossCountry Mortgage, with closing expected on August 3, 2026.
- After the merger closes, the company will redeem Series A, B and C Preferred Stock at $25.00 per share plus unpaid dividends.
