Ellington Financial Launches Public Offering of 8.78 Million Shares
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 3d ago
0mins
Source: seekingalpha
- Public Offering Initiated: Ellington Financial has commenced an underwritten public offering of 8.78 million shares of common stock, with underwriters granted a 30-day option to purchase an additional 1.32 million shares, indicating the company's proactive stance towards capital markets.
- Clear Use of Proceeds: The company intends to use the net proceeds to redeem all outstanding shares of its Series A fixed-to-floating rate cumulative redeemable preferred stock, ensuring optimization of its capital structure and reduction of financial costs.
- Enhanced Strategic Flexibility: Any remaining proceeds may be allocated for general corporate purposes, including asset acquisitions aligned with its investment strategy, demonstrating the company's ability to respond flexibly to market opportunities.
- Stock Price Reaction: Following the announcement, Ellington Financial's stock price fell 2.80% in after-hours trading to $13.49, reflecting market caution regarding the public offering.
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Analyst Views on EFC
Wall Street analysts forecast EFC stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for EFC is 15.00 USD with a low forecast of 14.50 USD and a high forecast of 16.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
5 Analyst Rating
5 Buy
0 Hold
0 Sell
Strong Buy
Current: 13.360
Low
14.50
Averages
15.00
High
16.00
Current: 13.360
Low
14.50
Averages
15.00
High
16.00
About EFC
Ellington Financial Inc. is a real estate investment trust. The Company acquires and manages mortgage-related, consumer-related, corporate-related, and other financial assets. The Company’s segments include the Investment Portfolio Segment and the Longbridge Segment. The Investment Portfolio Segment is focused on investing in a diverse array of financial assets, including residential and commercial mortgage loans, residential mortgage-backed securities (RMBS), commercial mortgage-backed securities (CMBS), consumer loans and asset-backed securities (ABS), including ABS-backed by consumer loans, collateralized loan obligations (CLOs), non-mortgage- and mortgage-related derivatives, debt and equity investments in loan origination companies, and other strategic investments. The Longbridge Segment is focused on the origination and servicing of, and investment in, reverse mortgage loans. The Company is externally managed and advised by Ellington Financial Management LLC.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Ellington Financial Announces Redemption of Preferred Shares
- Redemption Plan: Ellington Financial's Board has authorized the redemption of 4.6 million shares of Series A Preferred Stock at a price of $25.00 per share plus accrued dividends, effective February 27, 2026, aimed at optimizing capital structure and reducing future dividend obligations.
- Trading Suspension: The Series A Preferred Stock will be suspended from trading on the NYSE before the redemption date, allowing the company to focus resources on other investment opportunities while mitigating market volatility impacts on shareholders.
- Transparent Process: The redemption will be executed through the Depository Trust Company (DTC), with Equiniti Trust Company acting as the redemption agent, ensuring a smooth redemption process that enhances investor confidence and maintains the company's reputation.
- Forward-Looking Statements: The company cautions that future performance may be influenced by various factors; while the redemption plan aims to enhance financial flexibility, attention must be paid to potential impacts from market volatility and interest rate changes on operations.
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ELLINGTON FINANCIAL STOCK DROPS 3.9% FOLLOWING $119 MILLION SHARE SALE
Stock Performance: Ellington Financial shares have decreased by 3.9%.
Recent Sale: This decline follows a significant stock sale amounting to $119 million.
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