Ellington Financial Inc (EFC) Q3 2024 Earnings Call Highlights: Strong Portfolio Growth and ...

GuruFocus.com11-08

Adjusted Distributable Earnings (ADE): $0.40 per share, a $0.07 increase from the second quarter. Dividends: $0.39 per share for the quarter. GAAP Net Income: $0.19 per share. Longbridge Segment ADE ...

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}\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nEllington Financial Inc (EFC) Q3 2024 Earnings Call Highlights: Strong Portfolio Growth and ...\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-11-08 15:24 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://finance.yahoo.com/news/ellington-financial-inc-efc-q3-072421210.html><strong>GuruFocus.com</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Adjusted Distributable Earnings (ADE): $0.40 per share, a $0.07 increase from the second quarter.\nDividends: $0.39 per share for the quarter.\nGAAP Net Income: $0.19 per share.\nLongbridge Segment ADE ...</p>\n\n<a href=\"https://finance.yahoo.com/news/ellington-financial-inc-efc-q3-072421210.html\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"EFC","symbol_name":"Ellington投资","start_time":0,"source_url":"https://finance.yahoo.com/news/ellington-financial-inc-efc-q3-072421210.html","article_id":"2481454201","we_media_id":null,"thumbnails":[],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2481454201","pubTimestamp":1731050661,"sourceInfo":{"source_id":"yahoofinance","name":"雅虎金融"},"weMediaInfo":null,"summary":"Adjusted Distributable Earnings : $0.40 per share, a $0.07 increase from the second quarter.Investment Portfolio Growth: Increased by 26% in non-QM, RTL, commercial mortgage bridge, HELOC, and closed-end second lien loan portfolios.Leverage Ratio: Increased to 1.8 times from 1.6 times.Cash and Unencumbered Assets: Totaled $765 million, nearly 50% of total equity.Origination Volume at Longbridge: Increased by 16.5% sequentially.Book Value Per Common Share: $13.66 at quarter end.Total Long Credit Portfolio: Increased by 19% to $3.25 billion as of September 30.Weighted Average Borrowing Rate: Decreased by 21 basis points to 6.77% at September 30.GuruFocus has detected 6 Warning Signs with EFC.Ellington Financial Inc  reported an increase in adjusted distributable earnings to $0.40 per share, covering the $0.39 dividend for the quarter.EFC's investment portfolio expanded, with high-yielding loan portfolios increasing by 26%, supported by strong balance sheet utilization.EFC added new finan","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":["earning"],"viewcount":null,"language":"en","relate_stocks":{"EFC":"Ellington投资"},"translate_title":"Ellington Financial Inc(EFC)2024年第三季度收益看涨期权亮点：强劲的投资组合增长和……","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"EFC":1},"content_text":"Adjusted Distributable Earnings (ADE): $0.40 per share, a $0.07 increase from the second quarter.\nDividends: $0.39 per share for the quarter.\nGAAP Net Income: $0.19 per share.\nLongbridge Segment ADE Contribution: $0.12 per share.\nInvestment Portfolio Growth: Increased by 26% in non-QM, RTL, commercial mortgage bridge, HELOC, and closed-end second lien loan portfolios.\nLeverage Ratio: Increased to 1.8 times from 1.6 times.\nAgency Portfolio Reduction: Shrunk by 14% sequentially.\nCash and Unencumbered Assets: Totaled $765 million, nearly 50% of total equity.\nOrigination Volume at Longbridge: Increased by 16.5% sequentially.\nBook Value Per Common Share: $13.66 at quarter end.\nTotal Economic Return: 0.9% non-annualized for Q3.\nTotal Long Credit Portfolio: Increased by 19% to $3.25 billion as of September 30.\nWeighted Average Borrowing Rate: Decreased by 21 basis points to 6.77% at September 30.\nRecourse Debt to Equity Ratio: Increased to 1.8:1 from 1.6:1.\n\n\nWarning! GuruFocus has detected 6 Warning Signs with EFC.\n\nRelease Date: November 07, 2024\nFor the complete transcript of the earnings call, please refer to the full earnings call transcript.\n Positive Points \n\nEllington Financial Inc (NYSE:EFC) reported an increase in adjusted distributable earnings to $0.40 per share, covering the $0.39 dividend for the quarter.\nThe Longbridge segment showed significant improvement, contributing $0.12 per share to adjusted distributable earnings, driven by a successful proprietary reverse mortgage securitization.\nEFC's investment portfolio expanded, with high-yielding loan portfolios increasing by 26%, supported by strong balance sheet utilization.\nThe company successfully executed multiple securitizations, including non-QM and proprietary reverse mortgage deals, achieving favorable financing terms.\nEFC added new financing lines, enhancing its ability to replace higher-cost debt and improve earnings through cost-effective refinancing.\n\n Negative Points \n\nThe Longbridge segment reported a GAAP net loss of $0.03 per share due to interest rate hedges, despite strong origination results.\nEFC faced net losses on its consumer loan portfolio and a related equity investment, impacting overall earnings.\nOperating expenses increased by 18% over the quarter, driven in part by one-time employee option redemptions at Longbridge.\nThe percentage of delinquent loans increased in the commercial mortgage loan portfolio, with some loans moving to 90+ day delinquencies.\nEFC's overall leverage increased to 1.8 times from 1.6 times, raising concerns about potential risks associated with higher leverage.\n\n Q & A Highlights \nQ: Can you provide an update on how you're viewing the relative value between agency and credit opportunities given recent interest rate movements? A: Mark Tecotzky, Co-Chief Investment Officer, explained that the reduction in the agency portfolio is not a comment on relative value but rather a strategic shift towards non-agency origination and securitization businesses. The agency portfolio is expected to continue declining in size, with capital being allocated to areas that can create better long-term franchise value.\nQ: What is the baseline contribution from Longbridge that could provide decent dividend coverage? A: Laurence Penn, CEO, mentioned that a $0.09 per share contribution from Longbridge is a reasonable target for dividend coverage. However, there will be volatility due to interest rate sensitivity. The ability to execute securitizations will also support this target.\nQ: How has the participation of insurance companies impacted the non-QM market? A: Mark Tecotzky noted that insurance companies have been consistent buyers, stabilizing loan prices and reducing volatility. While they create competition, their presence has been beneficial for market stability and has diversified the market for originators.\nQ: Can you discuss the increase in operating expenses this quarter? A: Laurence Penn explained that the increase was primarily due to a one-time redemption of employee-held options at Longbridge, which will not recur in the next quarter.\nQ: What are your expectations for the pace of securitizations, and how has the execution been on reverse mortgage deals? A: Laurence Penn stated that they expect to conduct four to six non-QM securitizations next year, depending on market conditions. The execution on reverse mortgage deals has been satisfactory, with repeat buyers and plans to accumulate for another deal.\nFor the complete transcript of the earnings call, please refer to the full earnings call transcript.This article first appeared on \nGuruFocus.","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"1","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.3","shortVersion":"4.29.3","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2481454201"}