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TWO-PB

Two Harbors Investment Corp.

TWO-PB

Two Harbors Investment Corp. • NYSE
$22.66 ▼ -1.48% (-0.34)
Market Cap $2.36 B
52w High $24.49
52w Low $21.28
Dividend Yield 1.91%
P/E 41.13
Volume 28.80K
Outstanding Shares 103.97M

Income Statement

Period Revenue Operating Expense Net Income Net Profit Margin Earnings Per Share EBITDA
Q3-2025 $247.571M ▲ $21.307M ▼ $-127.921M ▲ -51.67% ▲ $-1.36 ▲ $-9.597M ▼
Q2-2025 $119.383M ▼ $21.469M ▼ $-259.041M ▼ -216.983% ▼ $-2.62 ▼ $79.256M ▲
Q1-2025 $268.241M ▼ $47.094M ▲ $-79.055M ▼ -29.472% ▼ $-0.89 ▼ $53.09M ▼
Q4-2024 $491.729M ▲ $40.885M ▲ $264.945M ▲ 53.88% ▲ $2.54 ▲ $307.601M ▲
Q3-2024 $126.483M $20.18M $-238.485M -188.551% $-2.42 $-94.012M

Balance Statement

Period Cash & Short-term Total Assets Total Liabilities Total Equity
Q3-2025 $7.119B ▲ $10.866B ▼ $9.095B ▼ $1.772B ▼
Q2-2025 $975.054M ▲ $12.959B ▼ $11.073B ▼ $1.886B ▼
Q1-2025 $829.25M ▼ $13.683B ▲ $11.537B ▲ $2.147B ▲
Q4-2024 $7.876B ▲ $12.204B ▼ $10.082B ▼ $2.123B ▼
Q3-2024 $611.706M $12.888B $10.718B $2.169B

Cash Flow Statement

Period Net Income Cash From Operations Cash From Investing Cash From Financing Net Change Free Cash Flow
Q3-2025 $338.096M ▲ $-239.238M ▼ $2.127B ▲ $-1.8B ▼ $88.624M ▼ $-118.106M ▼
Q2-2025 $79.055M ▲ $99.112M ▼ $829.22M ▲ $-827.76M ▼ $100.572M ▲ $-111.913M ▼
Q1-2025 $-79.055M ▼ $111.913M ▲ $-2.028B ▼ $1.796B ▲ $-119.916M ▼ $111.913M ▲
Q4-2024 $276.729M ▲ $-21.059M ▼ $1.224B ▲ $-996.972M ▼ $205.935M ▲ $-48.564M ▼
Q3-2024 $-238.485M $87.081M $-254.936M $-7.261M $-175.116M $43.887M

Five-Year Company Overview

Income Statement

Income Statement The income statement shows a business that is profitable over the full period but quite volatile, which is typical for mortgage REITs. Results dipped sharply during the pandemic and again in 2023, but bounced back strongly most recently, with a clear improvement in earnings and overall profitability. Much of the lumpiness likely comes from interest-rate swings and changes in the value of mortgage assets, not just day‑to‑day operations. Overall, the trend suggests a company that can recover from tough periods, but whose earnings should be viewed as cyclical and sensitive to the rate environment rather than smooth and predictable.

Balance Sheet

Balance Sheet The balance sheet reflects a highly leveraged, capital‑intensive model, which is normal for this type of REIT but still a key risk area. Total assets have edged down from earlier peaks, while debt has risen materially versus the pre‑2021 period and then leveled off, indicating a heavier reliance on borrowing to run the strategy. Equity has gradually drifted lower from earlier levels but has been relatively stable in recent years, suggesting no dramatic erosion of the capital base lately, just limited cushion. Cash on hand has trended down from earlier years, meaning the company has less immediate liquidity than before and is more reliant on its funding lines and capital markets access in a stress scenario.

Cash Flow

Cash Flow Cash flow from operations has been consistently positive, indicating that the servicing and investment platform generates real cash, not just accounting profits. Free cash flow moves around more, at times close to flat or modestly negative, reflecting ongoing reinvestment in the portfolio and the broader platform rather than a pure cash‑harvesting stance. Spending on investments and capital‑like items has been steady and meaningful, which supports growth and capabilities but also keeps the company dependent on external funding. Overall, the cash profile looks workable but not overly conservative, with limited room for prolonged disruption in mortgage or funding markets.

Competitive Edge

Competitive Edge Two Harbors competes in a crowded mortgage REIT space but stands out through its strong focus on mortgage servicing rights and its ownership of RoundPoint, the servicing platform. This integration gives it more control over costs, better data, and the ability to directly influence borrower experience, which many peers lack. The MSR focus also provides a partial natural hedge against rising interest rates, helping offset pressure on its mortgage securities when rates move up. At the same time, the company still faces intense competition from banks, non‑bank servicers, and other mREITs, plus regulatory and funding risks that can quickly change the economics of the business. Its edge is more about execution, expertise, and platform design than about having a truly unassailable moat.

Innovation and R&D

Innovation and R&D While it does not do traditional R&D, Two Harbors is investing in technology, data, and process innovation around its mortgage servicing and origination activities. Through RoundPoint, it uses advanced analytics and APIs to price and manage servicing rights more dynamically, and it offers a mobile app to keep borrowers engaged and reduce churn. The addition of a dedicated technology leader and partnerships with fintech and analytics providers show a deliberate push to modernize operations and lower unit costs. Newer moves into direct‑to‑consumer origination and potential second‑lien products are strategic innovations in business model, designed to capture and retain more servicing economics over the life of the loan. These efforts have clear strategic logic, but the scale and consistency of the financial payoff still need to be proven over time.

Summary

Two Harbors is a specialized mortgage REIT built around mortgage servicing rights and agency mortgage securities, with a vertically integrated servicing platform as its core differentiator. Financially, it has shown the ability to rebound after shocks, but earnings and book value are inherently volatile and highly exposed to interest‑rate cycles and funding conditions. The balance sheet is heavily leveraged with a modest equity cushion and declining cash, which is typical for the sector but leaves limited room for prolonged market stress. Operationally, the firm appears to be ahead of many peers in treating servicing and data as strategic assets, with technology, AI, and direct‑to‑consumer channels used to protect and grow its MSR base. Over the long run, the company’s success will likely hinge on how well it can manage interest‑rate risk, maintain stable financing, and execute on its technology‑driven servicing and origination strategy without overextending its balance sheet.