Overview

* Two Harbors reports Q2 2025 comprehensive loss of $221.8 mln due to litigation costs

* Book value per share falls to $12.14, with a negative 14.5% economic return

* Company issued $115 mln in senior notes and settled $6.6 bln in MSR acquisitions

Outlook

* Company sees opportunity in wide Agency RMBS spreads

* Two Harbors expects stable prepayments to benefit core strategy

* Two Harbors sees opportunity in current market environment

Result Drivers

* LITIGATION COSTS - $199.9 mln expense related to ongoing litigation with PRCM Advisers LLC impacted results

* MSR ACQUISITIONS - Settled $6.6 bln in unpaid principal balance of MSR through various acquisitions

* SENIOR NOTES ISSUANCE - Issued $115 mln in senior notes due 2030, indicating continued financial activity

Key Details

Metric Beat/Mis Actual Consensu

s s

Estimate

Q2 Net -$272.28

Income mln

Q2 $0.39

Dividend

Analyst Coverage

* The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 4 "strong buy" or "buy", 6 "hold" and no "sell" or "strong sell"

* The average consensus recommendation for the specialized reits peer group is "buy"

* Wall Street's median 12-month price target for Two Harbors Investment Corp ( TWO/PA ) is $12.75, about 18% above its July 25 closing price of $10.45

* The stock recently traded at 7 times the next 12-month earnings vs. a P/E of 8 three months ago

Press Release:

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)