TWO HARBORS INVESTMENT CORP (TWO) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:TWO - US90187B8046 - REIT
10.22 USD
+0.02 (+0.2%)
10.22 USD
0 (0%)
We assign a fundamental rating of 4 out of 10 to TWO. TWO was compared to 69 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
TWO had positive earnings in the past year.
In the past year TWO has reported a negative cash flow from operations.
In multiple years TWO reported negative net income over the last 5 years.
Each year in the past 5 years TWO had a positive operating cash flow.
1.2 Ratios
TWO has a worse Return On Assets (-2.23%) than 79.71% of its industry peers.
TWO has a Return On Equity of -13.70%. This is amonst the worse of the industry: TWO underperforms 82.61% of its industry peers.
The Return On Invested Capital of TWO (0.23%) is worse than 69.57% 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 72.46% 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 81.16% 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
The number of shares outstanding for TWO has been increased compared to 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.
The Altman-Z score of TWO (-1.14) is worse than 97.10% of its industry peers.
TWO has a Debt/Equity ratio of 4.76. This is a high value indicating a heavy dependency on external 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
A Current Ratio of 0.17 indicates that TWO may have some problems paying its short term obligations.
TWO's Current ratio of 0.17 is in line compared to the rest of the industry. TWO outperforms 55.07% of its industry peers.
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.
TWO has a Quick ratio (0.17) which is comparable to the rest of the 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
TWO is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 39.13% yearly.
The Revenue is expected to grow by 16.42% on average over the next years. This is quite good.
EPS Next Y122.2%
EPS Next 2Y60.24%
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
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
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
TWO is valuated reasonably with a Price/Earnings ratio of 9.46.
Based on the Price/Earnings ratio, TWO is valued a bit cheaper than 69.57% of the companies in the same industry.
TWO is valuated cheaply when we compare the Price/Earnings ratio to 26.49, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 7.24, the valuation of TWO can be described as very cheap.
Compared to the rest of the industry, the Price/Forward Earnings ratio of TWO indicates a somewhat cheap valuation: TWO is cheaper than 79.71% of the companies listed in the same industry.
TWO's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 23.69.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.46 | ||
| Fwd PE | 7.24 |
4.2 Price Multiples
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | N/A |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as TWO's earnings are expected to grow with 39.13% in the coming years.
PEG (NY)0.08
PEG (5Y)N/A
EPS Next 2Y60.24%
EPS Next 3Y39.13%
5. Dividend
5.1 Amount
TWO has a Yearly Dividend Yield of 15.98%, which is a nice return.
Compared to an average industry Dividend Yield of 12.09, TWO pays a better dividend. On top of this TWO pays more dividend than 91.30% of the companies listed in the same industry.
TWO's Dividend Yield is rather good when compared to the S&P500 average which is at 2.31.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 15.98% |
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 2Y60.24%
EPS Next 3Y39.13%
10.22
+0.02 (+0.2%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryMortgage Real Estate Investment Trusts (REITs)"
Earnings (Last)
Earnings (Next)
Inst Owners71.25%
Inst Owner Change-3.95%
Ins Owners0.84%
Ins Owner Change-0.29%
Market Cap1.06B
Revenue(TTM)933.29M
Net Income(TTM)-242.81M
Analysts72.31
Price Target11.14 (9%)
Short Float %9.55%
Short Ratio6.01
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 15.98% |
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)-2.65%
PT rev (3m)-5.75%
EPS NQ rev (1m)0.99%
EPS NQ rev (3m)-1.17%
EPS NY rev (1m)-4.72%
EPS NY rev (3m)6.45%
Revenue NQ rev (1m)-12.63%
Revenue NQ rev (3m)22.35%
Revenue NY rev (1m)6.92%
Revenue NY rev (3m)11.22%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.46 | ||
| Fwd PE | 7.24 | ||
| P/S | 1.14 | ||
| P/FCF | N/A | ||
| P/OCF | N/A | ||
| P/B | 0.6 | ||
| P/tB | 0.6 | ||
| EV/EBITDA | N/A |
EPS(TTM)1.08
EY10.57%
EPS(NY)1.41
Fwd EY13.82%
FCF(TTM)-0.47
FCFYN/A
OCF(TTM)-0.47
OCFYN/A
SpS8.96
BVpS17.01
TBVpS17.01
PEG (NY)0.08
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 Y122.2%
EPS Next 2Y60.24%
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.
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 9.46 and the Price/Book (PB) ratio is 0.6.
How sustainable is the dividend of TWO HARBORS INVESTMENT CORP (TWO) stock?
The dividend rating of TWO HARBORS INVESTMENT CORP (TWO) is 5 / 10 and the dividend payout ratio is -95.7%.