TWO HARBORS INVESTMENT CORP (TWO) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:TWO - US90187B8046 - REIT
12.28 USD
+0.05 (+0.41%)
12.21 USD
-0.07 (-0.57%)
Overall TWO gets a fundamental rating of 4 out of 10. We evaluated TWO against 68 industry peers in the Mortgage Real Estate Investment Trusts (REITs)" industry. TWO has a medium profitability rating, but doesn't score so well on its financial health evaluation. TWO has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
TWO had positive earnings in the past year.
TWO had a negative operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: TWO reported negative net income in multiple years.
TWO had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
TWO has a worse Return On Assets (-2.23%) than 79.41% of its industry peers.
Looking at the Return On Equity, with a value of -13.70%, TWO is doing worse than 82.35% of the companies in the same industry.
With a Return On Invested Capital value of 0.23%, TWO is not doing good in the industry: 69.12% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -2.23% | ||
| ROE | -13.7% | ||
| ROIC | 0.23% |
ROA(3y)0.75%
ROA(5y)-1.08%
ROE(3y)4.44%
ROE(5y)-7.45%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
TWO's Profit Margin has improved in the last couple of years.
With a Operating Margin value of 2.96%, TWO is not doing good in the industry: 72.06% of the companies in the same industry are doing better.
In the last couple of years the Operating Margin of TWO has grown nicely.
TWO has a better Gross Margin (42.34%) than 82.35% of its industry peers.
In the last couple of years the Gross Margin of TWO has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 2.96% | ||
| PM (TTM) | N/A | ||
| GM | 42.34% |
OM growth 3Y-12.76%
OM growth 5Y2.83%
PM growth 3Y-8.93%
PM growth 5Y1.71%
GM growth 3Y-9.32%
GM growth 5Y7.66%
2. Health
2.1 Basic Checks
TWO has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, TWO has more shares outstanding
Compared to 1 year ago, TWO has an improved debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of -1.13, we must say that TWO is in the distress zone and has some risk of bankruptcy.
TWO has a worse Altman-Z score (-1.13) than 97.06% of its industry peers.
A Debt/Equity ratio of 4.76 is on the high side and indicates that TWO has dependencies on debt financing.
TWO's Debt to Equity ratio of 4.76 is in line compared to the rest of the industry. TWO outperforms 52.94% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.76 | ||
| Debt/FCF | N/A | ||
| Altman-Z | -1.13 |
ROIC/WACCN/A
WACCN/A
2.3 Liquidity
TWO has a Current Ratio of 0.17. This is a bad value and indicates that TWO is not financially healthy enough and could expect problems in meeting its short term obligations.
TWO has a Current ratio (0.17) which is in line with its industry peers.
A Quick Ratio of 0.17 indicates that TWO may have some problems paying its short term obligations.
TWO's Quick ratio of 0.17 is in line compared to the rest of the industry. TWO outperforms 55.88% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.17 | ||
| Quick Ratio | 0.17 |
3. Growth
3.1 Past
TWO shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 350.00%, which is quite impressive.
TWO shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -36.86% yearly.
Looking at the last year, TWO shows a quite strong growth in Revenue. The Revenue has grown by 11.13% in the last year.
Measured over the past years, TWO shows a decrease in Revenue. The Revenue has been decreasing by -1.54% on average per year.
EPS 1Y (TTM)350%
EPS 3Y-44.86%
EPS 5Y-36.86%
EPS Q2Q%176.92%
Revenue 1Y (TTM)11.13%
Revenue growth 3Y37.26%
Revenue growth 5Y-1.54%
Sales Q2Q%44.42%
3.2 Future
Based on estimates for the next years, TWO will show a very strong growth in Earnings Per Share. The EPS will grow by 39.13% on average per year.
Based on estimates for the next years, TWO will show a quite strong growth in Revenue. The Revenue will grow by 16.42% on average per year.
EPS Next Y125.87%
EPS Next 2Y62.37%
EPS Next 3Y39.13%
EPS Next 5YN/A
Revenue Next Year42.68%
Revenue Next 2Y22.49%
Revenue Next 3Y16.42%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 11.37, the valuation of TWO can be described as reasonable.
Based on the Price/Earnings ratio, TWO is valued a bit cheaper than 66.18% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 27.25. TWO is valued rather cheaply when compared to this.
TWO is valuated reasonably with a Price/Forward Earnings ratio of 8.47.
Based on the Price/Forward Earnings ratio, TWO is valued a bit cheaper than 66.18% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.98, TWO is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.37 | ||
| Fwd PE | 8.47 |
4.2 Price Multiples
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | N/A |
4.3 Compensation for Growth
TWO's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
TWO's earnings are expected to grow with 39.13% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.09
PEG (5Y)N/A
EPS Next 2Y62.37%
EPS Next 3Y39.13%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 8.32%, TWO is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 10.90, TWO's dividend is way lower than its industry peers. On top of this 83.82% of the companies listed in the same industry pay a better dividend than TWO!
TWO's Dividend Yield is rather good when compared to the S&P500 average which is at 1.92.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.32% |
5.2 History
The dividend of TWO decreases each year by -22.81%.
TWO has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)-22.81%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
The earnings of TWO are negative and hence is the payout ratio. TWO will probably not be able to sustain this dividend level.
DP-95.7%
EPS Next 2Y62.37%
EPS Next 3Y39.13%
12.28
+0.05 (+0.41%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryMortgage Real Estate Investment Trusts (REITs)"
Earnings (Last)
Earnings (Next)
Inst Owners70.4%
Inst Owner Change0.23%
Ins Owners1.14%
Ins Owner Change16.13%
Market Cap1.28B
Revenue(TTM)933.29M
Net Income(TTM)-242.81M
Analysts70.77
Price Target11.12 (-9.45%)
Short Float %8.56%
Short Ratio3.79
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.32% |
Yearly Dividend2.27
Dividend Growth(5Y)-22.81%
DP-95.7%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-12.86%
Min EPS beat(2)-24.05%
Max EPS beat(2)-1.67%
EPS beat(4)0
Avg EPS beat(4)-26.75%
Min EPS beat(4)-44.22%
Max EPS beat(4)-1.67%
EPS beat(8)0
Avg EPS beat(8)-49.08%
EPS beat(12)0
Avg EPS beat(12)-61.9%
EPS beat(16)2
Avg EPS beat(16)-46.7%
Revenue beat(2)2
Avg Revenue beat(2)12.53%
Min Revenue beat(2)5.25%
Max Revenue beat(2)19.81%
Revenue beat(4)3
Avg Revenue beat(4)6.94%
Min Revenue beat(4)-30.77%
Max Revenue beat(4)33.5%
Revenue beat(8)3
Avg Revenue beat(8)-40.42%
Revenue beat(12)3
Avg Revenue beat(12)-4527.34%
Revenue beat(16)7
Avg Revenue beat(16)-3082.98%
PT rev (1m)-0.15%
PT rev (3m)-4.53%
EPS NQ rev (1m)4.11%
EPS NQ rev (3m)-1.53%
EPS NY rev (1m)1.65%
EPS NY rev (3m)0.33%
Revenue NQ rev (1m)15.15%
Revenue NQ rev (3m)34.11%
Revenue NY rev (1m)0%
Revenue NY rev (3m)11.22%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.37 | ||
| Fwd PE | 8.47 | ||
| P/S | 1.37 | ||
| P/FCF | N/A | ||
| P/OCF | N/A | ||
| P/B | 0.72 | ||
| P/tB | 0.72 | ||
| EV/EBITDA | N/A |
EPS(TTM)1.08
EY8.79%
EPS(NY)1.45
Fwd EY11.81%
FCF(TTM)-0.47
FCFYN/A
OCF(TTM)-0.47
OCFYN/A
SpS8.96
BVpS17.01
TBVpS17.01
PEG (NY)0.09
PEG (5Y)N/A
Graham Number20.33
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -2.23% | ||
| ROE | -13.7% | ||
| ROCE | 0.84% | ||
| ROIC | 0.23% | ||
| ROICexc | 0.25% | ||
| ROICexgc | 0.26% | ||
| OM | 2.96% | ||
| PM (TTM) | N/A | ||
| GM | 42.34% | ||
| FCFM | N/A |
ROA(3y)0.75%
ROA(5y)-1.08%
ROE(3y)4.44%
ROE(5y)-7.45%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexgc growth 3Y18.48%
ROICexgc growth 5Y28.02%
ROICexc growth 3Y18.89%
ROICexc growth 5Y27.71%
OM growth 3Y-12.76%
OM growth 5Y2.83%
PM growth 3Y-8.93%
PM growth 5Y1.71%
GM growth 3Y-9.32%
GM growth 5Y7.66%
F-Score4
Asset Turnover0.09
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.76 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | N/A | ||
| Cap/Depr | N/A | ||
| Cap/Sales | N/A | ||
| Interest Coverage | 0.05 | ||
| Cash Conversion | N/A | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.17 | ||
| Quick Ratio | 0.17 | ||
| Altman-Z | -1.13 |
F-Score4
WACCN/A
ROIC/WACCN/A
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)350%
EPS 3Y-44.86%
EPS 5Y-36.86%
EPS Q2Q%176.92%
EPS Next Y125.87%
EPS Next 2Y62.37%
EPS Next 3Y39.13%
EPS Next 5YN/A
Revenue 1Y (TTM)11.13%
Revenue growth 3Y37.26%
Revenue growth 5Y-1.54%
Sales Q2Q%44.42%
Revenue Next Year42.68%
Revenue Next 2Y22.49%
Revenue Next 3Y16.42%
Revenue Next 5YN/A
EBIT growth 1Y113.47%
EBIT growth 3Y19.75%
EBIT growth 5Y1.25%
EBIT Next YearN/A
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-110.47%
FCF growth 3Y-22%
FCF growth 5Y-28.24%
OCF growth 1Y-110.47%
OCF growth 3Y-22%
OCF growth 5Y-28.24%
TWO HARBORS INVESTMENT CORP / TWO FAQ
Can you provide the ChartMill fundamental rating for TWO HARBORS INVESTMENT CORP?
ChartMill assigns a fundamental rating of 4 / 10 to TWO.
What is the valuation status of TWO HARBORS INVESTMENT CORP (TWO) stock?
ChartMill assigns a valuation rating of 6 / 10 to TWO HARBORS INVESTMENT CORP (TWO). This can be considered as Fairly Valued.
What is the profitability of TWO stock?
TWO HARBORS INVESTMENT CORP (TWO) has a profitability rating of 4 / 10.
Can you provide the PE and PB ratios for TWO stock?
The Price/Earnings (PE) ratio for TWO HARBORS INVESTMENT CORP (TWO) is 11.37 and the Price/Book (PB) ratio is 0.72.
What is the financial health of TWO HARBORS INVESTMENT CORP (TWO) stock?
The financial health rating of TWO HARBORS INVESTMENT CORP (TWO) is 1 / 10.