Loading...
01/11 16:21
Loading...
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call reflects a positive sentiment overall, with strong financial performance, a significant dividend increase, and strategic growth initiatives. The acquisition of Palisades and the focus on diversification and liquidity management are promising. Although there are operational integration risks and some management responses were vague, the overall outlook is optimistic. The market cap suggests a moderate reaction, leading to a positive prediction for the stock price movement over the next two weeks.
Earnings Available for Distribution (EAD) $33,500,000 (up 11% year-over-year) due to improved operational efficiency and increased revenue diversification.
GAAP Net Income $145,900,000 or $1.77 per share (no year-over-year change mentioned).
Book Value $21.17 per share (up 7.4% year-over-year) driven by yield compression in performing loans.
Economic Return on GAAP Book Value 9.2% (no year-over-year change mentioned).
Economic Net Interest Income $72,300,000 (no year-over-year change mentioned).
Yield on Average Interest Earning Assets 5.9% (no year-over-year change mentioned).
Average Cost of Funds 4.4% (no year-over-year change mentioned).
Net Interest Spread 1.5% (no year-over-year change mentioned).
Total Leverage 3.9:1 (no year-over-year change mentioned).
Rico's Leverage 1.2:1 (no year-over-year change mentioned).
Total Cash and Unencumbered Assets $697,000,000 (no year-over-year change mentioned).
Cash Extracted from Refinancings $187,000,000 (from exercising call rights on non REMIC securitizations).
Additional Cash from Refinancing $100,000,000 (from refinancing two structured repo facilities).
Economic Net Interest Income Return on Average Equity 11.2% (no year-over-year change mentioned).
GAAP Return on Average Equity 25.9% (no year-over-year change mentioned).
EAD Return on Average Equity 8.1% (no year-over-year change mentioned).
Transaction Expenses $5,700,000 (reflecting increased securitization activity).
Third Party Loans Under Management: Third party loans under management by Palisades Advisory Services are up 43% year over year, including an increase of $1,500,000,000 during the first quarter to nearly $24,000,000,000.
Acquisition of Non QM Loans: In January, we acquired and securitized $288,000,000 in non QM loans.
Agency Specified Pools: In March, we picked up $149,000,000 of agency specified pools.
Residential Transition Loans: We settled $100,000,000 in residential transition loans during the quarter.
Market Positioning: We’re building Chimera into a hybrid mortgage REIT that’s resilient and diversified.
Growth Potential: We believe that there’s a fair amount of growth potential in the third party business.
Cash Extraction from Refinancing: We extracted more than $100,000,000 of additional cash from refinancings.
Securitization Activity: We exercised our call rights on all our non REMIC securitizations and issued two new securitizations backed by those loans, unlocking $187,000,000.
Liquidity Position: We ended the quarter with $253,000,000 in cash and $444,000,000 of unencumbered assets.
Strategic Focus: We expect to diversify the portfolio, grow recurring fee income, add liquidity and look for opportunities to add accretive platforms.
Risk Management: We remain focused on disciplined risk management and thoughtful portfolio construction.
Market Volatility: The company faced significant market volatility in April, which impacted treasury yields and credit spreads, leading to a cautious approach in capital deployment.
Regulatory and Economic Factors: The new administration's policy priorities, including immigration reform and global trade partnerships, may affect market conditions and the company's operations.
Interest Rate Sensitivity: The company has a floating rate sensitivity of $2 billion on outstanding repo liabilities, which could be impacted by future interest rate movements.
Delinquency Rates: There is a potential risk of increased delinquency rates in the non-QM and newer issue loans, although the company currently does not foresee significant risk due to strong borrower equity.
Credit Spread Widening: Credit spreads widened during the quarter, which could affect the company's book value and overall financial performance.
Securitization Execution Risk: The company is actively managing securitization execution risk through hedging strategies, but any missteps could impact financial results.
Liquidity Management: The company is focused on maintaining liquidity amid market dislocation, which is crucial for navigating potential funding shocks.
Operational Integration Risks: The integration of Palisades Advisory Services poses operational risks, although initial results have been positive.
Integration of Palisades: The integration of Palisades was fast and seamless, enhancing Chimera's capabilities and diversifying revenue.
Growth in Third Party Loans: Third party loans under management by Palisades Advisory Services increased by 43% year over year, reaching nearly $24 billion.
Balance Sheet Moves: Chimera exercised call rights on non REMIC securitizations, unlocking $187 million in cash through refinancing.
Acquisition of Non QM Loans: In January, Chimera acquired and securitized $288 million in non QM loans, expecting low teen returns.
Focus on Agency RMBS: Chimera is adding Agency RMBS assets to enhance returns, liquidity, and flexibility.
Diversification Strategy: Chimera aims to diversify its portfolio, grow recurring fee income, and seek accretive platforms.
Book Value Outlook: Current book value is estimated to be flat to slightly down from the end of Q1, approximately down 40 basis points.
Capital Deployment: Chimera has deployed about 33% to 40% of the $187 million freed up from re-securitization, with plans to deploy the remainder in the next 4 to 8 weeks.
Dividend Consideration: The decision regarding dividends will be evaluated in the next month, considering market volatility.
Economic Return Expectations: Chimera expects to maintain a strong economic return through disciplined risk management and portfolio construction.
Dividend per share: $0.37 for the first quarter of 2025.
Cash unlocked from refinancing: $187,000,000 from re-securitization of non-REMIC transactions.
Additional cash from refinancing: $100,000,000 from refinancing two structured repo facilities.
Total deployable capital: $287,000,000 available for investment.
The earnings call reveals mixed signals: a 62% YoY increase in share price and positive product growth, but a net loss and restructuring efforts raise concerns. The Q&A highlights uncertainties with regulatory approvals and contract renewals, while SG&A expenses are expected to rise. The market cap suggests a moderate reaction, balancing positive growth with operational and financial uncertainties.
The earnings call reveals several concerns: increased transaction expenses, interest rate sensitivity, portfolio repositioning dragging earnings, and a rise in loan delinquencies. While there are positive elements like dividend growth expectations and increased liquidity, the overall sentiment is weighed down by negative financial performance, including a GAAP net loss, negative economic return, and unclear management responses in the Q&A. The market cap suggests a moderate reaction, but the negative aspects are likely to dominate, predicting a stock price decline in the range of -2% to -8%.
The earnings call reveals mixed signals: strong growth in third-party loans and strategic acquisitions are positive, but the lack of specific year-over-year changes and a decline in book value are concerning. The Q&A section shows management's optimism about future earnings and strategic diversification, but also highlights uncertainties in dividend strategy and market conditions. The market cap suggests moderate sensitivity to these factors. Overall, the sentiment leans towards neutral, with potential positive catalysts offset by financial and strategic uncertainties.
The earnings call highlights strong financial performance, with EPS and net income growth, increased book value, and a dividend hike. The Palisades acquisition and investment in technology suggest positive future growth. Despite some concerns about interest expense and market volatility, the company's strategic measures, like hedging interest rate risk and managing liquidity, are reassuring. The Q&A indicates analysts' cautious optimism, with no major negative trends disclosed. Considering the company's small-cap status, the positive financial indicators and strategic initiatives suggest a likely positive stock price movement over the next two weeks.
All transcripts are sourced directly from the official live webcast or the company’s official investor relations website. We use the exact words spoken during the call with no paraphrasing of the core discussion.
Full verbatim transcripts are typically published within 4–12 hours after the call ends. Same-day availability is guaranteed for all S&P 500 and most mid-cap companies.
No material content is ever changed or summarized in the “Full Transcript” section. We only correct obvious spoken typos (e.g., “um”, “ah”, repeated 10 times”, or clear misspoken ticker symbols) and add speaker names/titles for readability. Every substantive sentence remains 100% as spoken.
When audio quality is poor or multiple speakers talk over each other, we mark the section instead of guessing. This ensures complete accuracy rather than introducing potential errors.
They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
