Investing in Orchid Island Capital is Still Not Recommended
December 14, 2023
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Orchid Island Capital ($NYSE:ORC) is a public company trading on the New York Stock Exchange under the ticker symbol ORC. Despite the company’s past success, investing in Orchid Island Capital is still not recommended. The company has seen a steady decrease in stock price over the last few years, and investors have seen their returns greatly diminish. The company’s leadership has been unable to turn things around, and the future of the company remains uncertain.
In addition, the company’s business model of relying heavily on mortgage-backed securities has proven to be unstable. The market for these securities is highly volatile, and the company has been unable to properly manage the risks associated with investing in them. This lack of sound management has resulted in losses for shareholders and a poor outlook for the future. The company’s business model has proven to be unreliable and its stock price has been steadily declining in recent years. Until the company is able to turn things around and recover from its losses, it is best to avoid investing in this stock.
Price History
Despite the rise of 5.8% in ORCHID ISLAND CAPITAL’s stock on Wednesday, with the opening price of $7.8 and closing price of $8.2, investing in the company is still not recommended. This trend of losses and volatility has caused many investors to consider other options for their investments. Although the company may show signs of recovery in the near future, current market conditions suggest that avoiding ORCHID ISLAND CAPITAL is still the best move for potential investors. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for ORC. More…
| Total Revenues | Net Income | Net Margin |
| -9.51 | -31.43 | – |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for ORC. More…
| Operations | Investing | Financing |
| 47.54 | -1.44k | 1.39k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for ORC. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 4.94k | 4.47k | 8.96 |
Key Ratios Snapshot
Some of the financial key ratios for ORC are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| – | – | – |
| FCF Margin | ROE | ROA |
| – | – | – |
Analysis
At GoodWhale, we performed an analysis of ORCHID ISLAND CAPITAL’s wellbeing. Our Star Chart showed that the company is strong in asset, but weak in dividend, growth, and profitability. Additionally, ORCHID ISLAND CAPITAL’s health score was a low 3/10 due to its cashflows and debt, making it less likely to safely ride out any crisis without the risk of bankruptcy. After further review, we classified the company as a ‘cow’, which we concluded has a track record of paying out consistent and sustainable dividends. Considering this, investors who prefer steady income may be interested in ORCHID ISLAND CAPITAL. These investors may have a low risk tolerance and prefer investments that offer reliable returns and dividend payments. Investors may also be attracted to the overall stability of ORCHID ISLAND CAPITAL, despite its low growth rate. More…
Peers
The company’s competitors include Invesco Mortgage Capital Inc, Chimera Investment Corp, and AGNC Investment Corp.
– Invesco Mortgage Capital Inc ($NYSE:IVR)
Invesco Mortgage Capital Inc is a US-based real estate investment trust. It is engaged in the business of investing in, financing, and managing residential and commercial mortgage-backed securities and other mortgage-related assets.
The company had a market capitalization of $424.93 million as of March 31, 2022. Invesco Mortgage Capital Inc is externally managed by Invesco Advisers, Inc., a subsidiary of Invesco Ltd.
– Chimera Investment Corp ($NYSE:CIM)
Chimera Investment Corporation is a real estate investment trust that focuses on investments in the residential mortgage-backed securities market. The company has a market cap of 1.45B as of 2022. Chimera was founded in 2007 and is headquartered in New York, NY.
– AGNC Investment Corp ($NASDAQ:AGNC)
AGNC Investment Corp is a publicly traded real estate investment trust that invests in residential mortgage-backed securities. The company is headquartered in Bethesda, Maryland, and is externally managed by American Capital Agency Management LLC, a wholly owned subsidiary of American Capital Ltd. As of December 31, 2020, AGNC Investment Corp had a portfolio of $145.6 billion of residential mortgage-backed securities and $5.6 billion of other investments.
Summary
Orchid Island Capital (ORC) is a high-risk investment choice that may provide investors with potential returns. Despite a bump in the stock price the same day it was announced, investors should carefully research and evaluate the company’s fundamentals and risk exposures before investing. This includes financial statements, management experience, news about competitors, and any other factors that could affect the future performance of ORC.
Additionally, it is important to consider the potential rewards of investing in ORC relative to the risks. By doing so, investors can make an informed decision on whether or not ORC is the right investment choice for them.
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