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Two Harbors Investment Corp
TWO : NYSE : Financial
$7.52 | %
Today's Range: 7.48 - 7.68
Avg. Daily Volume: 3,362,500
02/05/16 - 4:02 PM ET

Financial Analysis


TWO HARBORS INVESTMENT CORP's gross profit margin for the fourth quarter of its fiscal year 2015 is essentially unchanged when compared to the same period a year ago. The company grew its sales and net income significantly quarter versus same quarter a year prior, and was able to outpace the average competitor in the industry when comparing revenue growth, but not when comparing net income growth.

During the same period, stockholders' equity ("net worth") has decreased by 12.08% from the same quarter last year.

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Income Statement Q4 FY15 Q4 FY14
Net Sales ($mil)251.39165.45
EBITDA ($mil)0.0135.96
EBIT ($mil)213.54135.64
Net Income ($mil)210.71-36.96


Balance Sheet Q4 FY15 Q4 FY14
Cash & Equiv. ($mil)1000.393340.22
Total Assets ($mil)14575.7721084.31
Total Debt ($mil)10793.3816642.13
Equity ($mil)3576.564068.04


Profitability Q4 FY15 Q4 FY14
Gross Profit Margin84.9482.17
EBITDA Margin0.082.17
Operating Margin84.9481.98
Sales Turnover0.070.03
Return on Assets3.370.79
Return on Equity13.764.1
Debt Q4 FY15 Q4 FY14
Current Ratio0.00.0
Debt/Capital0.750.8
Interest Expense36.5831.7
Interest Coverage5.844.28


Share Data Q4 FY15 Q4 FY14
Shares outstanding (mil)353.91366.4
Div / share0.260.26
EPS0.59-0.1
Book value / share10.1111.1
Institutional Own % n/a n/a
Avg Daily Volume3425103.02805685.0

Valuation


HOLD. TWO HARBORS INVESTMENT CORP's P/E ratio indicates a significant discount compared to an average of 46.36 for the Real Estate Investment Trusts (REITs) industry and a significant discount compared to the S&P 500 average of 21.13. For additional comparison, its price-to-book ratio of 0.75 indicates a significant discount versus the S&P 500 average of 2.51 and a significant discount versus the industry average of 3.71. The price-to-sales ratio is well above the S&P 500 average, but well below the industry average. Upon assessment of these and other key valuation criteria, TWO HARBORS INVESTMENT CORP proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
TWO 5.57 Peers 46.36   TWO NA Peers 17.62

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

TWO is trading at a significant discount to its peers.

 

Neutral. The P/CF ratio is the stock’s price divided by the sum of the company's cash flow from operations. It is useful for comparing companies with different capital requirements or financing structures.

Ratio not available.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
TWO 7.98 Peers 47.16   TWO 0.05 Peers 32.56

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

TWO is trading at a significant discount to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

TWO trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
TWO 0.75 Peers 3.71   TWO 195.65 Peers 55.20

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

TWO is trading at a significant discount to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

TWO is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
TWO 2.74 Peers 7.85   TWO 43.68 Peers 17.61

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

TWO is trading at a significant discount to its industry on this measurement.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

TWO has a sales growth rate that significantly exceeds its peers.

 

 

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