Two Harbors Investments (NYSE:TWO) Shares Pass Above 200 Day Moving Average - What's Next?

Key Points

• Shares crossed above the 200‑day moving average: TWO traded as high as $11.14 and last at $11.099 with ~4.24M shares, rising above its 200‑day MA of $10.57 — a potential technical bullish signal.
• Analyst sentiment is tepid to negative: seven Hold ratings and two Sell ratings, with recent downgrades from UBS, Maxim and JPMorgan and an average price target of $12.88.
• High income but mixed fundamentals: the company declared a $0.34 quarterly dividend (annualized $1.36) for a 12.3% yield (ex‑dividend Apr 2), while recent quarterly EPS of $0.26 missed estimates and the firm reported a negative net margin.

Two Harbors Investments Corp (NYSE:TWO - Get Free Report)'s stock price crossed above its two hundred day moving average during trading on Friday . The stock has a two hundred day moving average of $10.57 and traded as high as $11.14. Two Harbors Investments shares last traded at $11.0990, with a volume of 4,242,774 shares traded.

Wall Street Analysts Forecast Growth

TWO has been the subject of several recent research reports. UBS Group downgraded shares of Two Harbors Investments from a "buy" rating to a "neutral" rating and lifted their target price for the stock from $11.00 to $14.00 in a research note on Friday, January 23rd. Maxim Group cut shares of Two Harbors Investments from a "buy" rating to a "hold" rating in a research note on Thursday, December 18th. JPMorgan Chase & Co. reduced their price objective on shares of Two Harbors Investments from $13.50 to $12.50 and set a "neutral" rating for the company in a research note on Wednesday, February 4th. Weiss Ratings reissued a "sell (d)" rating on shares of Two Harbors Investments in a report on Monday, December 29th. Finally, Zacks Research downgraded Two Harbors Investments from a "hold" rating to a "strong sell" rating in a research report on Tuesday, January 27th. Seven investment analysts have rated the stock with a Hold rating and two have assigned a Sell rating to the company. Based on data from MarketBeat, Two Harbors Investments has an average rating of "Reduce" and an average price target of $12.88.

Two Harbors Investments Stock Down 0.2%

The stock has a fifty day simple moving average of $10.89 and a two-hundred day simple moving average of $10.57. The firm has a market cap of $1.17 billion, a PE ratio of -2.27 and a beta of 1.08. The company has a current ratio of 1.09, a quick ratio of 1.09 and a debt-to-equity ratio of 1.09.

Two Harbors Investments (NYSE:TWO - Get Free Report) last announced its quarterly earnings results on Monday, February 2nd. The real estate investment trust reported $0.26 earnings per share (EPS) for the quarter, missing analysts' consensus estimates of $0.30 by ($0.04). The firm had revenue of $182.18 million during the quarter, compared to analysts' expectations of ($15.44) million. Two Harbors Investments had a positive return on equity of 12.00% and a negative net margin of 109.90%. As a group, sell-side analysts expect that Two Harbors Investments Corp will post 0.81 EPS for the current fiscal year.

Two Harbors Investments Dividend Announcement

The company also recently declared a quarterly dividend, which will be paid on Wednesday, April 15th. Shareholders of record on Thursday, April 2nd will be issued a $0.34 dividend. This represents a $1.36 annualized dividend and a yield of 12.3%. The ex-dividend date of this dividend is Thursday, April 2nd. Two Harbors Investments's dividend payout ratio (DPR) is presently -27.81%.

Institutional Inflows and Outflows

A number of hedge funds have recently made changes to their positions in the company. Clayton Partners LLC purchased a new position in Two Harbors Investments during the third quarter worth about $1,234,000. Pekin Hardy Strauss Inc. bought a new position in Two Harbors Investments in the 3rd quarter worth about $5,325,000. Simplicity Wealth LLC purchased a new stake in shares of Two Harbors Investments in the 3rd quarter valued at about $954,000. Algebris UK Ltd. bought a new stake in shares of Two Harbors Investments during the 3rd quarter valued at about $17,558,000. Finally, Public Sector Pension Investment Board boosted its position in shares of Two Harbors Investments by 14.5% during the 3rd quarter. Public Sector Pension Investment Board now owns 406,202 shares of the real estate investment trust's stock valued at $4,009,000 after acquiring an additional 51,520 shares during the last quarter. 64.19% of the stock is currently owned by hedge funds and other institutional investors.

About Two Harbors Investments

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.

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