Chimera Investment (NYSE:CIM) Issues Quarterly Earnings Results

Key Points

• Chimera Investment reported quarterly EPS of $0.46, $0.08 below analyst expectations, while revenue of $94.77 million was slightly below estimates. Earnings available for distribution covered the company’s $0.45 quarterly dividend.
• Book value per share fell 3.2% to $17.75 amid higher interest rates and weaker securitized-loan portfolio marks. Management said book value was down about 1.5% quarter-to-date.
• Shares declined 6.9% to $11.79, while management highlighted record HomeXpress loan production and a shift toward more liquid, higher-yielding assets; analysts’ consensus rating remained Hold with a $14.75 average target price.

Chimera Investment (NYSE:CIM - Get Free Report) issued its quarterly earnings data on Wednesday. The real estate investment trust reported $0.46 EPS for the quarter, missing analysts' consensus estimates of $0.54 by ($0.08), FiscalAI reports. Chimera Investment had a return on equity of 9.36% and a net margin of 2.27%.The company had revenue of $94.77 million for the quarter, compared to analyst estimates of $95.30 million.

Here are the key takeaways from Chimera Investment's conference call:

• Earnings available for distribution were $0.46 per share, covering the $0.45 quarterly dividend. Management reiterated its expectation of at least $1.80 in 2026 EAD, despite ongoing market uncertainty.
• Book value per share declined 3.2% to $17.75 during the quarter, reflecting higher interest rates and weaker marks on Chimera’s securitized loan portfolio; management said book value was down approximately 1.5% quarter-to-date.
• HomeXpress delivered record $1.1 billion loan production, up 30% year over year and 24% sequentially, but earnings growth was modest as competition compressed margins. The company plans to improve profitability through greater scale, operating efficiencies, and disciplined underwriting.
• Chimera is pivoting toward acquiring and securitizing HomeXpress and third-party mortgage loans, targeting two HomeXpress transactions and one third-party transaction by year-end. Management expects to decide opportunistically whether to retain credit risk for recurring income or distribute transactions and recognize gain-on-sale revenue.
• The investment portfolio was repositioned toward more liquid, higher-yielding assets, with agency MBS increasing to 26% of invested capital and approximately $656 million of cash and unencumbered assets maintained. Credit performance also improved in re-performing and investor DSCR portfolios, while residential credit financing remained conservatively structured.

Chimera Investment Stock Down 6.9%

Shares of CIM traded down $0.88 during midday trading on Wednesday, hitting $11.79. The company had a trading volume of 1,694,415 shares, compared to its average volume of 777,814. The company has a quick ratio of 0.08, a current ratio of 0.08 and a debt-to-equity ratio of 2.31. The stock has a market cap of $985.82 million, a price-to-earnings ratio of -14.73 and a beta of 1.67. Chimera Investment has a 52 week low of $11.46 and a 52 week high of $14.88. The company's 50 day moving average price is $13.11 and its 200 day moving average price is $13.17.

Chimera Investment Announces Dividend

The business also recently announced a quarterly dividend, which was paid on Friday, July 31st. Stockholders of record on Tuesday, June 30th were given a $0.45 dividend. The ex-dividend date of this dividend was Tuesday, June 30th. This represents a $1.80 annualized dividend and a dividend yield of 15.3%. Chimera Investment's payout ratio is presently -225.00%.

Hedge Funds Weigh In On Chimera Investment

Hedge funds have recently added to or reduced their stakes in the business. Victory Capital Management Inc. acquired a new stake in Chimera Investment during the third quarter worth about $272,000. BNP Paribas Financial Markets grew its position in shares of Chimera Investment by 148.7% during the third quarter. BNP Paribas Financial Markets now owns 19,112 shares of the real estate investment trust's stock worth $253,000 after acquiring an additional 11,426 shares during the last quarter. Mercer Global Advisors Inc. ADV acquired a new position in Chimera Investment during the 3rd quarter valued at about $242,000. Quantbot Technologies LP bought a new stake in shares of Chimera Investment during the second quarter valued at approximately $235,000. Finally, Zurcher Kantonalbank Zurich Cantonalbank grew its holdings in Chimera Investment by 29.4% in the 3rd quarter. Zurcher Kantonalbank Zurich Cantonalbank now owns 17,313 shares of the real estate investment trust's stock worth $229,000 after buying an additional 3,937 shares in the last quarter. Institutional investors and hedge funds own 48.44% of the company's stock.

Analyst Upgrades and Downgrades

Several equities analysts recently commented on the company. Weiss Ratings lowered Chimera Investment from a "sell (d+)" rating to a "sell (d)" rating in a research report on Monday. Wall Street Zen raised shares of Chimera Investment from a "sell" rating to a "hold" rating in a research report on Sunday, June 28th. Finally, Royal Bank Of Canada restated a "sector perform" rating and issued a $14.00 target price on shares of Chimera Investment in a research note on Wednesday, June 3rd. One research analyst has rated the stock with a Buy rating, one has issued a Hold rating and one has assigned a Sell rating to the stock. According to MarketBeat, the company presently has a consensus rating of "Hold" and an average target price of $14.75.

About Chimera Investment

Chimera Investment Corporation NYSE: CIM is a publicly traded real estate investment trust that specializes in investing in residential mortgage assets. The company's portfolio primarily consists of agency and non-agency residential mortgage-backed securities, whole loan residential mortgages and other mortgage-related assets. As a REIT, Chimera Investment aims to generate attractive risk-adjusted returns through its focus on high-quality collateral and disciplined risk management.

The firm's core business activities include identifying and acquiring portfolios of residential mortgage loans and securities from financial institutions and in the secondary market.

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