NYSE$ORC

Orchid Island Ca · Q3 2023 earnings

Q3 2023 earnings · · Investor relations

Briefing

Orchid Island Capital's Q3 2023 results were announced with a net loss of $80.1 million and a book value per common share of $8.92.

Orchid Island Capital reported a net loss of $80.1 million, or $1.68 per common share, for the third quarter of 2023. The company's book value per common share was $8.92 at the end of the quarter. The results were impacted by net interest expense and net realized and unrealized losses on RMBS and derivative instruments.

  • Net loss of $80.1 million, or $1.68 per common share, was reported for Q3 2023.
  • Net interest expense was $8.6 million, or $0.18 per common share.
  • Book value per common share was $8.92 at September 30, 2023.
  • Total return of (15.77)% was reported, including a $0.48 dividend per common share.

Headline financials

Total Revenue

-$8.6M

Previous: $14.2M-160.3%
EPS (adj)

-$0.28

Previous: -$2.40+88.3%
Constant prepayment rate

6.0%

Previous: 6.5%-7.7%
Net Income

-$80.1M

Previous: -$84.5M+5.2%
Cash & Equivalents

$278M

Previous: $281M-1.0%
Total Assets

$4.94B

Previous: $3.81B+29.7%
Stock-Based Comp

$287K

Previous: $148K+93.9%

Revenue & EPS history

Orchid Island · Revenue · Quarterly

-$8.6M

Q3 2023-160.3%vs Q3 2022
Beat estimate in 4 of 13 quarters(31%)
ActualEstimate

Forward guidance

Orchid Island Capital is navigating a challenging market environment with increased interest rates and volatility, focusing on preserving liquidity and maintaining suitable leverage. The company anticipates a potential normalization of rates but is prepared for a scenario with persistently higher rates. Recent actions include reducing leverage and increasing hedges in response to market conditions.

Tailwinds

  • Orchid maintains a lower coupon bias, believing these securities offer superior total return potential.
  • The company added higher coupon, low pay-up specified pools and hedged these positions predominantly with swaps.
  • Actions were taken to reduce leverage and increase hedges in response to the significant increase in interest rates and volatility.
  • The company is focused on preserving liquidity and maintaining suitable levels of leverage.
  • Orchid is positioned to maximize potential upside when the market stabilizes.

Headwinds

  • The credit rating of the U.S. was downgraded by Fitch, and Moody's has indicated it may do the same.
  • Deficits in the U.S. were revised meaningfully higher in July.
  • The market appears to be demanding a term-premium to hold U.S. Treasury debt.
  • Economic data implies the U.S. economy is very resilient in the face of higher interest rates.
  • Elevated levels of volatility and few buyers of the asset class have led to meaningful underperformance for the mortgage market.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2023

Historical avgQ3 2023

-1.0%

Avg return

Earnings day

-2.1%

Avg return

5 days after

-3.7%

Avg return

30 days after

44%

25 / 57 earnings

Positive

+7.5%

Q4 2023

Best reaction

-12.4%

Q4 2016

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+3.2%+2.8%-1.2%
Q4 2025-5.7%-7.4%-10.0%
Q3 2025+2.7%-0.5%-3.2%
Q2 2025+1.2%-2.1%-2.3%
Q1 2025+5.1%+3.2%-0.1%
Q3 2024+1.4%+0.9%-1.4%
Q2 2024+1.3%+3.1%+4.5%
Q1 2024+1.0%-3.5%-0.7%
Q4 2023+7.5%+3.4%+8.5%
Q3 2023-1.3%+2.6%+20.8%
Q2 2023-4.0%-6.1%-14.5%
Q1 2023-1.8%-12.8%-7.5%
Q4 2022+1.7%-0.6%-8.9%
Q3 2022-0.1%+0.2%+8.0%
Q2 2022-1.9%-1.9%-19.9%
Q1 2022-4.1%+2.4%+5.2%
Q4 2021-4.8%-11.2%-5.9%
Q3 2021-1.2%-1.2%-4.4%
Q2 2021-3.1%-4.1%+0.2%
Q1 2021-1.4%-1.8%-2.0%
Q4 2020-2.1%-1.0%+2.4%
Q3 2020+1.2%+3.3%+6.8%
Q2 2020+1.2%-2.2%+1.4%
Q1 2020-5.1%-6.8%+2.0%
Q4 2019+3.2%-2.2%-59.4%
Q3 2019-4.1%-3.8%-2.9%
Q2 2019+0.6%+0.6%-13.0%
Q1 2019-1.0%-4.6%-4.9%
Q4 2018-0.6%-1.1%-3.8%
Q3 2018-3.8%-6.9%-2.2%
Q2 2018-2.1%-1.9%-4.0%
Q1 2018-2.9%-6.6%-1.9%
Q4 2017-2.7%+1.4%-2.7%
Q3 2017+2.7%-0.9%-1.6%
Q2 2017+1.7%+0.5%+2.4%
Q1 2017-3.8%-2.6%-8.3%
Q4 2016-12.4%-17.5%-18.8%
Q3 2016+3.3%+3.8%+2.9%
Q2 2016+1.1%+1.3%-3.4%
Q1 2016-10.6%
Q4 2015+3.0%
Q3 2015-10.4%
Q2 2015+3.7%
Q1 2015-0.4%
Q4 2014-6.5%
Q3 2014+0.1%
Q2 2014-0.3%
Q1 2014+1.5%
Q4 2013+1.8%
Q3 2013-0.9%
Q3 2012-0.9%
Q2 2012+0.9%
Q2 2013-1.1%
Q1 2013+0.2%
Q1 2012+0.2%
Q4 2011-3.3%
Q4 2012-3.3%
Q3 2011
Q2 2011
Q1 2011

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