Two Harbors Investment Corp. ( TWO/PA ) shares are trading lower on Friday. The company disclosed a definitive merger deal with CrossCountry Mortgage.

Details

Under the terms of the deal, TWO stockholders will receive $10.80 per share in cash for the merger.

In addition to the cash payout, holders of TWO’s preferred stock will have their shares redeemed at $25.00 per share, plus any accumulated dividends.

The companies expect the transaction to close in the second half of 2026, pending customary closing conditions and stockholder approval.

Once the transaction is finalized, TWO common stock will be delisted from the New York Stock Exchange. It will operate as a wholly owned subsidiary of CrossCountry.

This strategic move aims to create a fully integrated mortgage company. It will combine TWO’s mortgage servicing rights portfolio with CrossCountry’s retail origination platform.

As of December 31, TWO’s cash and cash equivalents stood at $842.3 million.

Termination Of Deal With UWH

In connection with this deal, Two Harbors will terminate its prior agreement with UWM Holdings Corporation ( UWMC ) dated December 17, 2025.

As part of the deal, CrossCountry, on behalf of TWO, will pay UWMC a termination fee of $25.4 million per the terms of the original merger agreement.

Ron Leonhardt, Founder and CEO of CrossCountry Mortgage stated “This transaction further solidifies CCM’s position as a one-of-one player in the mortgage market, with the #1 retail origination platform for the third year in a row and the #6 non-bank servicing platform with over $370 billion in unpaid principal balance.”

Earnings & Analyst Outlook

Two Harbors Investment Corp. ( TWO/PA ) is slated to provide its next financial update on April 27, 2026 (estimated).

EPS Estimate: 25 cents (Up from 24 cents YoY)

Revenue Estimate: $-9.52 million (Up from $-20.33 million YoY)

Analyst Consensus & Recent Actions: The stock carries a Hold Rating with an average price target of $14.15. Recent analyst moves include:

JP Morgan: Neutral (Lowers Target to $12.50) (Feb. 4)

UBS: Downgraded to Neutral (Raises Target to $14.00) (Jan. 23)

Maxim Group: Downgraded to Hold (Dec. 18, 2025)

Top ETF Exposure

Invesco KBW High Dividend Yield Financial ETF ( KBWD ) : 4.03% Weight

GraniteShares HIPS US High Income ETF ( HIPS ) : 2.77% Weight

WisdomTree Alternative Income Fund : 2.63% Weight

Significance: Because TWO carries significant weight in these funds, any significant inflows or outflows for these ETFs will likely force automatic buying or selling of the stock.

TWO Price Action: Two Harbors Investment ( TWO/PA ) shares were down 2.15% at $11.15 at the time of publication on Friday, according to Benzinga Pro data.