Two Harbors Investments (NYSE:TWO) Sees Large Volume Increase – Still a Buy?

Two Harbors Investments Corp (NYSE:TWO) shares saw unusually-strong trading volume on Friday . Approximately 5,399,042 shares changed hands during trading, an increase of 42% from the previous session’s volume of 3,798,939 shares.The stock last traded at $11.1650 and had previously closed at $11.40.

Key Two Harbors Investments News

Here are the key news stories impacting Two Harbors Investments this week:

• Positive Sentiment: Definitive merger agreement — Two Harbors agreed to be acquired and taken private by CrossCountry (transaction provides a certain liquidity event for shareholders). TWO and CrossCountry Mortgage Announce Definitive Merger Agreement
• Neutral Sentiment: Compass Point reaffirmed a “neutral” rating on TWO — a steady analyst stance that neither upgrades the stock nor signals support for a higher deal premium. Compass Point Reaffirms Rating
• Neutral Sentiment: Market and analyst commentary highlights mixed mortgage-REIT fundamentals and valuation questions — useful context for whether the deal price is attractive versus expected future returns. Is TWO Price Reflecting Its Mixed Returns?
• Neutral Sentiment: Unusually high options activity and elevated share volume indicate speculative and event-driven trading around the deal — increases short-term volatility risk. Unusually High Options Trading
• Negative Sentiment: Deal price and prior competing bid dynamics — CrossCountry’s $10.80 per-share proposal is higher than a previous suitor’s offer but sits below recent intraday trades, prompting a pre-market selloff as shareholders mark down to the announced take-private price. Termination of Prior UWM Deal; CrossCountry $10.80 Offer
• Negative Sentiment: Market reaction: reports note the stock “tumbled” pre-market after the sellout price was disclosed — downside pressure reflects the discount to where some holders had been valuing TWO. Two Stock Tumbles Pre-Market

Wall Street Analysts Forecast Growth

Several brokerages have weighed in on TWO. Compass Point cut Two Harbors Investments from a “buy” rating to a “hold” rating in a report on Friday. JPMorgan Chase & Co. reduced their target price on Two Harbors Investments from $13.50 to $12.50 and set a “neutral” rating on the stock in a report on Wednesday, February 4th. Zacks Research cut Two Harbors Investments from a “hold” rating to a “strong sell” rating in a research report on Tuesday, January 27th. Weiss Ratings reaffirmed a “sell (d)” rating on shares of Two Harbors Investments in a research note on Monday, December 29th. Finally, UBS Group cut shares of Two Harbors Investments from a “buy” rating to a “neutral” rating and upped their price objective for the stock from $11.00 to $14.00 in a research report on Friday, January 23rd. Seven investment analysts have rated the stock with a Hold rating and two have issued a Sell rating to the company. According to MarketBeat, Two Harbors Investments currently has an average rating of “Reduce” and a consensus price target of $12.88.

Two Harbors Investments Trading Down 1.7%

The firm’s 50-day simple moving average is $11.12 and its 200 day simple moving average is $10.53. The company has a debt-to-equity ratio of 1.09, a current ratio of 1.09 and a quick ratio of 1.09. The firm has a market capitalization of $1.18 billion, a price-to-earnings ratio of -2.29 and a beta of 1.18.

Two Harbors Investments (NYSE:TWO) last issued its earnings results on Monday, February 2nd. The real estate investment trust reported $0.26 earnings per share for the quarter, missing analysts’ consensus estimates of $0.30 by ($0.04). Two Harbors Investments had a negative net margin of 109.90% and a positive return on equity of 12.00%. The business had revenue of $182.18 million during the quarter, compared to analyst estimates of ($15.44) million. Equities analysts expect that Two Harbors Investments Corp will post 0.81 earnings per share for the current year.

Two Harbors Investments Dividend Announcement

The firm also recently disclosed a quarterly dividend, which will be paid on Wednesday, April 15th. Investors of record on Thursday, April 2nd will be paid a $0.34 dividend. The ex-dividend date of this dividend is Thursday, April 2nd. This represents a $1.36 annualized dividend and a yield of 12.1%. Two Harbors Investments’s dividend payout ratio (DPR) is -27.81%.

Institutional Inflows and Outflows

Several institutional investors have recently bought and sold shares of TWO. Smartleaf Asset Management LLC boosted its stake in Two Harbors Investments by 34.5% during the fourth quarter. Smartleaf Asset Management LLC now owns 3,825 shares of the real estate investment trust’s stock worth $40,000 after acquiring an additional 981 shares in the last quarter. Amalgamated Bank increased its stake in Two Harbors Investments by 3.9% in the third quarter. Amalgamated Bank now owns 30,604 shares of the real estate investment trust’s stock valued at $302,000 after purchasing an additional 1,158 shares in the last quarter. Intech Investment Management LLC increased its stake in Two Harbors Investments by 1.4% in the third quarter. Intech Investment Management LLC now owns 85,985 shares of the real estate investment trust’s stock valued at $849,000 after purchasing an additional 1,202 shares in the last quarter. Wealth Enhancement Advisory Services LLC raised its holdings in shares of Two Harbors Investments by 11.3% during the fourth quarter. Wealth Enhancement Advisory Services LLC now owns 12,391 shares of the real estate investment trust’s stock valued at $129,000 after purchasing an additional 1,261 shares during the period. Finally, Osaic Holdings Inc. raised its holdings in shares of Two Harbors Investments by 11.1% during the second quarter. Osaic Holdings Inc. now owns 13,130 shares of the real estate investment trust’s stock valued at $142,000 after purchasing an additional 1,309 shares during the period. Institutional investors and hedge funds own 64.19% of the company’s stock.

Two Harbors Investments Company Profile

Two Harbors Investments Corp. is a mortgage real estate investment trust (mREIT) that primarily invests in residential mortgage-backed securities (RMBS) issued or guaranteed by government-sponsored enterprises, as well as non-agency residential mortgage loans, mortgage servicing rights and credit risk transfer securities. The company seeks to generate attractive risk-adjusted returns for its shareholders by employing leverage to enhance net interest income derived from its portfolio of high-quality fixed-income assets.

Headquartered in Minneapolis, Minnesota, Two Harbors operates through a self-managed platform that combines portfolio management, risk-management and securitization expertise.