What is the market's earnings forecast for Invesco Mortgage Capital next quarter?

What does Invesco Mortgage Capital do and what are its main business segments?

Did Invesco Mortgage Capital beat or miss consensus estimates last quarter?

What is Invesco Mortgage Capital's latest dividend and current dividend yield?

What is the revenue and EPS growth rate for Invesco Mortgage Capital year over year?

What were the key takeaways from Invesco Mortgage Capital's earnings call?

What factors drove the changes in Invesco Mortgage Capital's revenue and profit?

What were the key takeaways from Invesco Mortgage Capital’s earnings call?

- **Strong Financial Performance**: Book value up 4.5% to $8.41, driven by declining mortgage rates and disciplined capital deployment.
- **Strategic Focus on Agency Securities**: Increased allocation to agency RMBS and CMBS, leveraging regulatory tailwinds and diversification benefits.
- **Hedging and Capital Management**: Preference for interest rate swaps, with cautious approach to buybacks based on market conditions.
- **Outlook for 2025**: Anticipated Fed easing and lower volatility support agency RMBS, with CMBS offering complementary risk-adjusted returns.

**【CEO Summary Section】**
- **Market Overview**: The third quarter saw strong momentum driven by easing monetary policy, improved economic growth, and declining interest rate volatility. Despite inflation remaining above the Fed's 2% target (headline CPI at 3%), the Federal Reserve cut rates twice and ended quantitative tightening, with futures pricing anticipating three more cuts by year-end.
- **Financial Performance**: Book value per common share increased 4.5% to $8.41, supported by a 50 basis point decline in 30-year mortgage rates. The company raised $36 million through an ATM program, maintaining a disciplined approach to capital deployment. Leverage ticked up to 6.7x debt-to-equity, reflecting reduced preferred stock allocation.
- **Strategic Focus**: Emphasis on agency RMBS and CMBS, with agency CMBS offering attractive risk-adjusted yields and diversification benefits. Anticipated regulatory changes are expected to boost demand for agency securities.

**【CIO Portfolio Update】**
- **Agency RMBS Performance**: Higher coupons outperformed due to improved specified pool premiums, offsetting prepayment risk. The portfolio shifted to higher loan-to-value borrowers to mitigate refinancing risk. Levered gross returns remained in the upper teens, with net returns mid-teens.
- **Agency CMBS**: Risk premiums tightened, with allocations maintained despite relative value compression. The sector provides prepayment protection and fixed maturities, complementing RMBS exposure.
- **Hedging Strategy**: Hedge ratio declined to 85%, with a preference for interest rate swaps over treasury futures. Swap spreads are expected to normalize, benefiting the portfolio.

**【Q&A Highlights】**
- **Hedge Portfolio Duration**: Positioning for a modest steepener with front-end focus, reflecting Fed uncertainty. Model duration slightly long due to premium-priced holdings.
- **Capital Structure**: Preferred stock buybacks ($2 million) minimal impact; common stock buybacks contingent on persistent price-to-book discount and accretive investment opportunities.
- **Asset Class Outlook**: Agency RMBS ROEs mid-teens, CMBS returns comparable to lower-coupon RMBS with convexity benefits. Relative value between sectors will drive future allocation decisions.

Invesco Mortgage Capital Inc. (IVR) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

IVR

IVR fundamentals

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