Two Harbors Investment Corp. Files 10-Q for Period Ending March 31, 2024

TL;DR

<b>Two Harbors Investment Corp. reported increased total assets and a slight decrease in total liabilities for Q1 2024, with net income of $525.3 million.</b>

AI Summary

TWO HARBORS INVESTMENT CORP. (TWOD) filed a Quarterly Report (10-Q) with the SEC on April 30, 2024. Total assets were $25,356,426,000 as of March 31, 2024, compared to $24,870,817,000 as of December 31, 2023. Total liabilities were $103,206,457,000 as of March 31, 2024, compared to $103,474,944,000 as of December 31, 2023. Net income for the three months ended March 31, 2024, was $525,259,000. Earnings per share (basic and diluted) for the three months ended March 31, 2024, were $0.01. The company reported $103,494,421,000 in total equity as of March 31, 2024.

Why It Matters

For investors and stakeholders tracking TWO HARBORS INVESTMENT CORP., this filing contains several important signals. The filing provides a quarterly update on the company's financial position, including asset and liability changes, which are crucial for investors to assess financial health and operational performance. Key financial metrics such as net income and earnings per share offer insights into the company's profitability during the first quarter of 2024, impacting investment decisions.

Risk Assessment

Risk Level: medium — TWO HARBORS INVESTMENT CORP. shows moderate risk based on this filing. The company operates in the real estate investment trust sector, which is sensitive to interest rate fluctuations and economic conditions, posing a medium risk to its financial stability.

Analyst Insight

Investors should monitor the company's interest rate sensitivity and its impact on portfolio performance in upcoming filings.

Key Numbers

• 25,356,426,000 — Total Assets (As of March 31, 2024)
• 103,206,457,000 — Total Liabilities (As of March 31, 2024)
• 525,259,000 — Net Income (For the three months ended March 31, 2024)
• 0.01 — Earnings Per Share (For the three months ended March 31, 2024)
• 103,494,421,000 — Total Equity (As of March 31, 2024)
• 24,870,817,000 — Total Assets (As of December 31, 2023)
• 103,474,944,000 — Total Liabilities (As of December 31, 2023)

Key Players & Entities

• TWO HARBORS INVESTMENT CORP. (company) — FILER
• 10-Q (filing) — CONFORMED SUBMISSION TYPE
• 2024-03-31 (date) — CONFORMED PERIOD OF REPORT
• 2024-04-30 (date) — FILED AS OF DATE
• REAL ESTATE INVESTMENT TRUSTS (industry) — STANDARD INDUSTRIAL CLASSIFICATION
• MD (state) — STATE OF INCORPORATION
• 1934 Act (regulation) — SEC ACT
• 001-34506 (identifier) — SEC FILE NUMBER

FAQ

Risk Factors

• Interest Rate Sensitivity [high — financial]: The company's financial performance is significantly impacted by changes in interest rates, which affect the value of its investments and borrowing costs.
• Real Estate Market Conditions [medium — market]: Adverse conditions in the real estate market, including declining property values or reduced rental income, can negatively affect the company's revenues and asset values.

Key Financial Figures

• $0.01 — ch Registered: Common Stock, par value $0.01 per share TWO New York Stock Exchange

Filing Documents

• two-20240331.htm (10-Q) — 2902KB
• twoexh3312024101.htm (EX-10.1) — 75KB
• twoexh3312024311.htm (EX-31.1) — 11KB
• twoexh3312024312.htm (EX-31.2) — 10KB
• twoexh3312024321.htm (EX-32.1) — 6KB
• twoexh3312024322.htm (EX-32.2) — 6KB
• 0001465740-24-000114.txt (&nbsp;) — 15269KB
• two-20240331.xsd (EX-101.SCH) — 92KB
• two-20240331_cal.xml (EX-101.CAL) — 94KB
• two-20240331_def.xml (EX-101.DEF) — 492KB
• two-20240331_lab.xml (EX-101.LAB) — 1007KB
• two-20240331_pre.xml (EX-101.PRE) — 800KB
• two-20240331_htm.xml (XML) — 3007KB

- FINANCIAL INFORMATION

PART I - FINANCIAL INFORMATION Item 1.

Financial Statements (unaudited)

Financial Statements (unaudited) 1 Condensed Consolidated Balance Sheets at March 31, 2024 and December 31, 2023 1 Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three Months Ended March 31, 2024 and 2023 2 Condensed Consolidated Statements of Stockholders' Equity for the Three Months Ended March 31, 2024 and 2023 3 Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2024 and 2023 4 Notes to the Condensed Consolidated Financial Statements 6 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 41 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 60 Item 4.

Controls and Procedures

Controls and Procedures 64

- OTHER INFORMATION

PART II - OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 65 Item 1A.

Risk Factors

Risk Factors 65 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 65 Item 3. Defaults Upon Senior Securities 66 Item 4. Mine Safety Disclosures 66 Item 5. Other Information 66 Item 6. Exhibits 67 Index of Exhibits 68

Signatures

Signatures 70 i Table of Contents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements TWO HARBORS INVESTMENT CORP. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except share data) March 31, 2024 December 31, 2023 ASSETS (unaudited) Available-for-sale securities, at fair value (amortized cost $ 8,467,938 and $ 8,509,383 , respectively; allowance for credit losses $ 3,607 and $ 3,943 , respectively) $ 8,182,544 $ 8,327,149 Mortgage servicing rights, at fair value 3,084,879 3,052,016 Cash and cash equivalents 666,244 729,732 Restricted cash 72,184 65,101 Accrued interest receivable 35,487 35,339 Due from counterparties 545,312 323,224 Derivative assets, at fair value 24,397 85,291 Reverse repurchase agreements 351,843 284,091 Other assets 199,035 236,857 Total Assets (1) $ 13,161,925 $ 13,138,800 LIABILITIES AND STOCKHOLDERS' EQUITY Liabilities: Repurchase agreements $ 8,361,638 $ 8,020,207 Revolving credit facilities 1,357,671 1,329,171 Term notes payable 295,520 295,271 Convertible senior notes 268,953 268,582 Derivative liabilities, at fair value 3,027 21,506 Due to counterparties 330,551 574,735 Dividends payable 58,685 58,731 Accrued interest payable 79,990 141,773 Commitments and contingencies (see Note 16) — — Other liabilities 165,820 225,434 Total Liabilities (1) 10,921,855 10,935,410 Stockholders' Equity: Preferred stock, par value $ 0.01 per share; 100,000,000 shares authorized and 24,870,817 and 25,356,426 shares issued and outstanding, respectively ($ 621,770 and $ 633,911 liquidation preference, respectively) 601,467 613,213 Common stock, par value $ 0.01 per share; 175,000,000 shares authorized and 103,474,944 and 103,206,457 shares issued and outstanding, respectively 1,035 1,032 Additional paid-in capital 5,931,558 5,925,424 Accumulated other comprehensive loss ( 279,507 ) ( 176,429 ) Cumulative earnings 1,554,205 1,349,973 Cumulative distributions to stockholders ( 5,568,688 ) ( 5,509,823 ) Total Stockholders' Equity 2,240,070 2,203,390 Total Liabilitie

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View this 10-Q filing on SEC EDGAR