IVR - Invesco Mortgage Q1 earnings beat helped by hedging strategy

2023-05-09 17:19:48 ET

Invesco Mortgage Capital ( NYSE: IVR ) shares advanced 2.5% in extended trading on Tuesday after posting Q1 earnings that surpassed the average analyst estimate a rose from the prior quarter against a volatile backdrop for the mortgage REIT.

Q1 earnings available for distribution per share of $1.50, breezing past the $1.12 consensus, rose from $1.46 in Q4 2022 and from $1.16 in the year-earlier quarter.

"EAD is well supported and is expected to continue to benefit from our hedging strategy, as borrowing costs are hedged by low-cost, pay-fixed swaps with a weighted average maturity of over seven years," said CEO John Anzalone. He noted that February and March were particularly volatile months for Agency RMBS "amidst the slowing disinflationary trend in economic data and turmoil in the regional banking sector."

Net interest income came in at $19.7M compared with $25.9M for the three months ended Dec. 31, 2022, and $44.3M for the three months ended March 31, 2022.

Total expenses, consisting of management fees and general and administrative costs, were $5.07M vs. $5.03M in Q4 2022 and $7.30M in Q1 2022.

Book value per common share was $12.61, down from $12.79 in Q4 2022, given underperformance in higher coupon Agency residential mortgage-backed securities.

Conference call on May 10 at 9:00 a.m. ET.

More on Invesco Mortgage Capital

• Invesco Mortgage Capital Non-GAAP EPS of $1.50 beats by $0.38, net interest income of $19.56M.

• Cherry Hill And Invesco Mortgage: The 2 Best mREIT Fixed-To-Floating Rate Preferreds

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