TWO HARBORS INVESTMENT CORP (TWO) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:TWO - US90187B8046 - REIT
11.45 USD
+0.04 (+0.35%)
11.4452 USD
0 (-0.04%)
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. While TWO is still in line with the averages on profitability rating, there are concerns on its financial health. TWO is not valued too expensively and it also shows a decent growth rate.
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.
In the past 5 years TWO always reported a positive cash flow from operatings.
1.2 Ratios
TWO's Return On Assets of -2.23% is on the low side compared to the rest of the industry. TWO is outperformed by 79.41% of its industry peers.
TWO has a Return On Equity of -13.70%. This is amonst the worse of the industry: TWO underperforms 82.35% of its industry peers.
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
In the last couple of years the Profit Margin of TWO has grown nicely.
The Operating Margin of TWO (2.96%) is worse than 72.06% of its industry peers.
In the last couple of years the Operating Margin of TWO has grown nicely.
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.
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.
TWO has more shares outstanding than it did 5 years ago.
TWO has a better debt/assets ratio than last year.
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.
Looking at the Altman-Z score, with a value of -1.13, TWO is doing worse than 97.06% of the companies in the same industry.
TWO has a Debt/Equity ratio of 4.76. This is a high value indicating a heavy dependency on external 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
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 55.88% of 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.
The Revenue has grown by 11.13% in the past year. This is quite good.
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
The Earnings Per Share is expected to grow by 39.13% on average over the next years. This is a very strong growth
TWO is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 16.42% yearly.
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.
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
With a Price/Earnings ratio of 10.60, the valuation of TWO can be described as very reasonable.
Based on the Price/Earnings ratio, TWO is valued a bit cheaper than the industry average as 69.12% of the companies are valued more expensively.
TWO is valuated cheaply when we compare the Price/Earnings ratio to 26.61, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 8.11, the valuation of TWO can be described as reasonable.
Compared to the rest of the industry, the Price/Forward Earnings ratio of TWO indicates a somewhat cheap valuation: TWO is cheaper than 67.65% of the companies listed in the same industry.
TWO is valuated cheaply when we compare the Price/Forward Earnings ratio to 24.01, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.6 | ||
| Fwd PE | 8.11 |
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.
A more expensive valuation may be justified as TWO's earnings are expected to grow with 39.13% in the coming years.
PEG (NY)0.09
PEG (5Y)N/A
EPS Next 2Y60.24%
EPS Next 3Y39.13%
5. Dividend
5.1 Amount
TWO has a Yearly Dividend Yield of 13.43%, which is a nice return.
TWO's Dividend Yield is a higher than the industry average which is at 12.23.
TWO's Dividend Yield is rather good when compared to the S&P500 average which is at 1.87.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 13.43% |
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 2Y60.24%
EPS Next 3Y39.13%
11.45
+0.04 (+0.35%)
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 Change9.96%
Market Cap1.19B
Revenue(TTM)933.29M
Net Income(TTM)-242.81M
Analysts72.31
Price Target11.14 (-2.71%)
Short Float %8.56%
Short Ratio6.12
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 13.43% |
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)-4.38%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-5.42%
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 | 10.6 | ||
| Fwd PE | 8.11 | ||
| P/S | 1.28 | ||
| P/FCF | N/A | ||
| P/OCF | N/A | ||
| P/B | 0.67 | ||
| P/tB | 0.67 | ||
| EV/EBITDA | N/A |
EPS(TTM)1.08
EY9.43%
EPS(NY)1.41
Fwd EY12.33%
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 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 10.6 and the Price/Book (PB) ratio is 0.67.
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%.