Why did GHI's Q4 2024 EPS fall short of forecasts?

The EPS of Greystone Housing Impact Investors (GHI) for Q4 2024 fell short of forecasts due to several key factors:

1. Interest Rate Derivatives Impact: GHI experienced significant unrealized losses of approximately $9.7 million from interest rate derivatives. These losses arose due to declining market interest rates, which affected the fair value of these derivatives. This factor significantly contributed to the net loss of $0.23 per Beneficial Unit Certificate (BUC) for the quarter.
2. Revenue Shortfall: While the company's total revenue for Q4 2024 was reported at $22.59 million, this fell slightly below the estimated $24.35 million. This shortfall, although relatively small, contributed to the overall EPS shortfall. The revenue was derived from the company's investments in mortgage revenue bonds and governmental issuer loans.
3. Strategic Investments and Market Conditions: Despite the challenges, GHI showcased resilience with strong cash flow and a robust investment portfolio. The company's investment portfolio included $1.32 billion in affordable multifamily investments and $169 million in joint venture equity investments. However, the performance of these investments is influenced by broader market conditions and interest rate fluctuations, which can affect the company's financial results.

In summary, GHI's Q4 2024 EPS fell short of forecasts primarily due to unrealized losses on interest rate derivatives and slightly lower-than-expected revenue, despite a strong investment portfolio and cash flow.