TWO HARBORS INVESTMENT CORP (TWO) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:TWO - US90187B8046 - REIT
9.72 USD
+0.27 (+2.86%)
9.71 USD
-0.01 (-0.1%)
Taking everything into account, TWO scores 4 out of 10 in our fundamental rating. TWO was compared to 68 industry peers in the Mortgage Real Estate Investment Trusts (REITs)" industry. There are concerns on the financial health of TWO while its profitability can be described as average. TWO has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year TWO was profitable.
TWO had a negative operating cash flow in the past year.
In multiple years TWO reported negative net income over the last 5 years.
TWO had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
TWO has a Return On Assets of -2.23%. This is in the lower half of the industry: TWO underperforms 79.41% of its industry peers.
With a Return On Equity value of -13.70%, TWO is not doing good in the industry: 82.35% of the companies in the same industry are doing better.
TWO has a worse Return On Invested Capital (0.23%) than 69.12% of its industry peers.
| 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.
TWO has a Operating Margin of 2.96%. This is in the lower half of the industry: TWO underperforms 76.47% of its industry peers.
TWO's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 42.34%, TWO belongs to the top of the industry, outperforming 82.35% of the companies in the same industry.
TWO's Gross Margin has improved in the last couple of years.
| 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.
TWO has more shares outstanding than it did 5 years ago.
The debt/assets ratio for TWO has been reduced compared to a year ago.
2.2 Solvency
TWO has an Altman-Z score of -1.14. This is a bad value and indicates that TWO is not financially healthy and even has some risk of bankruptcy.
TWO has a Altman-Z score of -1.14. This is amonst the worse of the industry: TWO underperforms 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.
The Debt to Equity ratio of TWO (4.76) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.76 | ||
| Debt/FCF | N/A | ||
| Altman-Z | -1.14 |
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.
Looking at the Current ratio, with a value of 0.17, TWO is in line with its industry, outperforming 54.41% of the companies in the same industry.
TWO has a Quick 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.
With a Quick ratio value of 0.17, TWO perfoms like the industry average, outperforming 54.41% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.17 | ||
| Quick Ratio | 0.17 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 350.00% over the past year.
The earnings per share for TWO have been decreasing by -36.86% on average. This is quite bad
Looking at the last year, TWO shows a quite strong growth in Revenue. The Revenue has grown by 11.13% in the last year.
TWO shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -1.54% yearly.
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 38.92% on average per year.
TWO is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.29% yearly.
EPS Next Y133.22%
EPS Next 2Y62.78%
EPS Next 3Y38.92%
EPS Next 5YN/A
Revenue Next Year38.42%
Revenue Next 2Y19.91%
Revenue Next 3Y7.29%
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.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 9.00, the valuation of TWO can be described as reasonable.
Based on the Price/Earnings ratio, TWO is valued a bit cheaper than 70.59% of the companies in the same industry.
TWO's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 25.45.
A Price/Forward Earnings ratio of 6.67 indicates a rather cheap valuation of TWO.
Based on the Price/Forward Earnings ratio, TWO is valued cheaply inside the industry as 83.82% of the companies are valued more expensively.
TWO's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 34.46.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9 | ||
| Fwd PE | 6.67 |
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 38.92% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.07
PEG (5Y)N/A
EPS Next 2Y62.78%
EPS Next 3Y38.92%
5. Dividend
5.1 Amount
TWO has a Yearly Dividend Yield of 17.25%, which is a nice return.
TWO's Dividend Yield is rather good when compared to the industry average which is at 12.59. TWO pays more dividend than 91.18% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.42, TWO pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 17.25% |
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
TWO has negative earnings and hence a negative payout ratio. The dividend may be in danger.
DP-95.7%
EPS Next 2Y62.78%
EPS Next 3Y38.92%
9.72
+0.27 (+2.86%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryMortgage Real Estate Investment Trusts (REITs)"
Earnings (Last)
Earnings (Next)
Inst Owners73.23%
Inst Owner Change-3.95%
Ins Owners0.85%
Ins Owner Change-0.29%
Market Cap1.01B
Revenue(TTM)933.29M
Net Income(TTM)-242.81M
Analysts72.31
Price Target11.14 (14.61%)
Short Float %10.3%
Short Ratio6.39
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 17.25% |
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)-4.38%
PT rev (3m)-5.07%
EPS NQ rev (1m)-5.75%
EPS NQ rev (3m)-1.44%
EPS NY rev (1m)1.6%
EPS NY rev (3m)11.73%
Revenue NQ rev (1m)31.06%
Revenue NQ rev (3m)31.06%
Revenue NY rev (1m)4.62%
Revenue NY rev (3m)4.62%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9 | ||
| Fwd PE | 6.67 | ||
| P/S | 1.08 | ||
| P/FCF | N/A | ||
| P/OCF | N/A | ||
| P/B | 0.57 | ||
| P/tB | 0.57 | ||
| EV/EBITDA | N/A |
EPS(TTM)1.08
EY11.11%
EPS(NY)1.46
Fwd EY14.99%
FCF(TTM)-0.47
FCFYN/A
OCF(TTM)-0.47
OCFYN/A
SpS8.96
BVpS17.01
TBVpS17.01
PEG (NY)0.07
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 | -1.14 |
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 Y133.22%
EPS Next 2Y62.78%
EPS Next 3Y38.92%
EPS Next 5YN/A
Revenue 1Y (TTM)11.13%
Revenue growth 3Y37.26%
Revenue growth 5Y-1.54%
Sales Q2Q%44.42%
Revenue Next Year38.42%
Revenue Next 2Y19.91%
Revenue Next 3Y7.29%
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.
Can you provide the valuation status for TWO HARBORS INVESTMENT CORP?
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 9 and the Price/Book (PB) ratio is 0.57.
How sustainable is the dividend of TWO HARBORS INVESTMENT CORP (TWO) stock?
The dividend rating of TWO HARBORS INVESTMENT CORP (TWO) is 4 / 10 and the dividend payout ratio is -95.7%.