Orchid Island Capital (NYSE:ORC) Sets New 1-Year Low - Should You Sell?

Key Points

• Orchid Island Capital fell to a new 52-week low of $4.99 and was last trading near $5.07, well below its 50-day and 200-day moving averages.
• Analysts maintain a cautious outlook, with a consensus rating of “Reduce” and a $7.50 price target. The company also missed quarterly expectations, reporting $0.26 in earnings per share versus the $0.28 consensus and revenue of $59.97 million versus $74.26 million expected.
• ORC continues to offer a monthly dividend of $0.10 per share, equating to an annualized yield of about 23.8%; its board also authorized repurchases of up to 12.5% of outstanding shares.

Orchid Island Capital, Inc. (NYSE:ORC - Get Free Report)'s stock price hit a new 52-week low during mid-day trading on Monday. The company traded as low as $4.99 and last traded at $5.0740, with a volume of 10897571 shares. The stock had previously closed at $5.11.

Wall Street Analysts Forecast Growth

ORC has been the topic of several research reports. Weiss Ratings upgraded shares of Orchid Island Capital from a "sell (d)" rating to a "sell (d+)" rating in a report on Wednesday, July 15th. BTIG Research initiated coverage on shares of Orchid Island Capital in a report on Thursday, July 9th. They set a "neutral" rating on the stock. Two equities research analysts have rated the stock with a Hold rating and one has assigned a Sell rating to the company. According to MarketBeat.com, the company presently has a consensus rating of "Reduce" and a consensus price target of $7.50.

Orchid Island Capital Trading Down 1.3%

The stock's 50 day simple moving average is $6.35 and its 200 day simple moving average is $6.70. The stock has a market capitalization of $1.01 billion, a P/E ratio of 3.42 and a beta of 1.60.

Orchid Island Capital (NYSE:ORC - Get Free Report) last released its quarterly earnings data on Thursday, July 23rd. The real estate investment trust reported $0.26 earnings per share for the quarter, missing analysts' consensus estimates of $0.28 by ($0.02). The company had revenue of $59.97 million for the quarter, compared to analyst estimates of $74.26 million.

Orchid Island Capital Announces Dividend

The business also recently announced a monthly dividend, which will be paid on Thursday, October 29th. Stockholders of record on Wednesday, September 30th will be given a dividend of $0.10 per share. The ex-dividend date of this dividend is Wednesday, September 30th. This represents a $1.20 dividend on an annualized basis and a dividend yield of 23.8%. Orchid Island Capital's payout ratio is 81.08%.

Orchid Island Capital declared that its board has authorized a stock repurchase program on Monday, June 22nd that permits the company to repurchase 25,000,000,000,000 outstanding shares. This repurchase authorization permits the real estate investment trust to purchase up to 12.5% of its shares through open market purchases. Shares repurchase programs are typically an indication that the company's board of directors believes its stock is undervalued.

Hedge Funds Weigh In On Orchid Island Capital

Several institutional investors and hedge funds have recently added to or reduced their stakes in ORC. Arizona State Retirement System boosted its position in Orchid Island Capital by 10.0% during the 2nd quarter. Arizona State Retirement System now owns 55,379 shares of the real estate investment trust's stock worth $386,000 after acquiring an additional 5,018 shares during the period. VIRGINIA RETIREMENT SYSTEMS ET Al purchased a new position in Orchid Island Capital during the second quarter valued at approximately $690,000. Ameritas Advisory Services LLC purchased a new stake in shares of Orchid Island Capital during the second quarter worth $78,000. Bank of New York Mellon Corp purchased a new position in Orchid Island Capital in the second quarter valued at about $3,899,000. Finally, GAMMA Investing LLC increased its position in Orchid Island Capital by 91.0% in the 2nd quarter. GAMMA Investing LLC now owns 3,650 shares of the real estate investment trust's stock worth $25,000 after purchasing an additional 1,739 shares during the last quarter. 32.74% of the stock is currently owned by hedge funds and other institutional investors.

About Orchid Island Capital

Orchid Island Capital, Inc is a real estate investment trust that invests primarily in residential mortgage-backed securities (RMBS) issued or guaranteed by U.S. government-sponsored entities. Its portfolio generally consists of agency securities backed by mortgages insured or guaranteed by the Government National Mortgage Association (Ginnie Mae), Federal National Mortgage Association (Fannie Mae), and Federal Home Loan Mortgage Corporation (Freddie Mac).

The company seeks to generate income from its investments and manage interest-rate and prepayment risks through portfolio construction, financing arrangements, and hedging strategies.

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