Chimera Investment (NYSE:CIM) Shares Gap Down - Should You Sell?

Key Points

• Chimera Investment shares fell sharply, opening at $9.84 versus a prior close of $10.20 and last trading near $9.86.
• Analyst sentiment is mixed but leans cautious: the stock has an average “Hold” rating and a consensus price target of $14.50, while recent targets were lowered to $14.00.
• The REIT missed quarterly earnings expectations, reporting $0.46 per share versus the $0.54 consensus, but announced a $0.45 quarterly dividend representing an annualized yield of about 18.6%.

Chimera Investment Corporation (NYSE:CIM - Get Free Report) shares gapped down prior to trading on Wednesday. The stock had previously closed at $10.20, but opened at $9.84. Chimera Investment shares last traded at $9.8550, with a volume of 164,202 shares traded.

Wall Street Analyst Weigh In

A number of equities research analysts recently weighed in on CIM shares. Weiss Ratings cut Chimera Investment from a "sell (d+)" rating to a "sell (d)" rating in a research note on Friday, September 18th. Wall Street Zen upgraded shares of Chimera Investment from a "sell" rating to a "hold" rating in a report on Sunday, June 28th. Keefe, Bruyette & Woods decreased their price target on shares of Chimera Investment from $15.00 to $14.00 and set a "market perform" rating for the company in a research report on Thursday, August 6th. Finally, Royal Bank Of Canada restated a "sector perform" rating and issued a $14.00 price target on shares of Chimera Investment in a report on Wednesday, June 3rd. One investment analyst has rated the stock with a Buy rating, two have given a Hold rating and one has issued a Sell rating to the company. According to data from MarketBeat, Chimera Investment has an average rating of "Hold" and a consensus price target of $14.50.

Chimera Investment Stock Performance

The company has a quick ratio of 0.07, a current ratio of 0.07 and a debt-to-equity ratio of 2.34. The company has a market capitalization of $811.59 million, a PE ratio of -9.53 and a beta of 1.66. The business has a 50 day simple moving average of $11.60 and a 200 day simple moving average of $12.66.

Chimera Investment (NYSE:CIM - Get Free Report) last issued its quarterly earnings results on Wednesday, August 5th. The real estate investment trust reported $0.46 earnings per share for the quarter, missing analysts' consensus estimates of $0.54 by ($0.08). The business had revenue of $94.77 million for the quarter, compared to analysts' expectations of $95.30 million. Chimera Investment had a return on equity of 9.82% and a net margin of 0.14%.

Chimera Investment Dividend Announcement

The business also recently announced a quarterly dividend, which will be paid on Friday, October 30th. Shareholders of record on Wednesday, September 30th will be given a dividend of $0.45 per share. This represents a $1.80 annualized dividend and a yield of 18.6%. The ex-dividend date of this dividend is Wednesday, September 30th. Chimera Investment's payout ratio is currently -176.47%.

Institutional Investors Weigh In On Chimera Investment

Several institutional investors and hedge funds have recently made changes to their positions in the stock. BlackRock Inc. increased its position in shares of Chimera Investment by 9.5% in the 2nd quarter. BlackRock Inc. now owns 7,855,125 shares of the real estate investment trust's stock valued at $104,787,000 after acquiring an additional 681,996 shares during the period. Thornburg Investment Management Inc. lifted its position in Chimera Investment by 0.7% during the 2nd quarter. Thornburg Investment Management Inc. now owns 5,511,923 shares of the real estate investment trust's stock worth $73,529,000 after acquiring an additional 35,621 shares during the period. Allianz Asset Management GmbH grew its stake in Chimera Investment by 6.9% during the 2nd quarter. Allianz Asset Management GmbH now owns 2,274,507 shares of the real estate investment trust's stock valued at $30,342,000 after purchasing an additional 147,119 shares during the last quarter. State Street Corp grew its stake in Chimera Investment by 7.8% during the 2nd quarter. State Street Corp now owns 2,029,275 shares of the real estate investment trust's stock valued at $27,957,000 after purchasing an additional 147,629 shares during the last quarter. Finally, First Trust Advisors LP increased its holdings in shares of Chimera Investment by 82.0% in the first quarter. First Trust Advisors LP now owns 543,101 shares of the real estate investment trust's stock valued at $6,816,000 after purchasing an additional 244,763 shares during the period. 48.44% of the stock is currently owned by institutional investors and hedge funds.

About Chimera Investment

Chimera Investment Corporation is a real estate investment trust that invests in residential mortgage assets. The company's portfolio has historically included residential mortgage-backed securities, residential mortgage loans and other mortgage-related investments, including both agency and non-agency assets.

Chimera seeks to generate income from the interest and cash flows associated with its investments. Its activities are primarily focused on the U.S. residential housing and mortgage markets, and the company may invest in assets with different levels of credit and prepayment risk.

Founded in 2007, Chimera is externally managed and has operated as a mortgage-focused REIT.

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