On Jun 15, 2013, Zacks Investment Research upgraded Ellington Financial LLC (EFC) to a Zacks Rank #1 (Strong Buy).
Why the Upgrade?
Ellington Financial has been witnessing rising earnings estimates on the back of strong fiscal first-quarter 2013 results. Moreover, shares of this mortgage investment company appreciated 10.6% year to date.
On May 6, 2013, Ellington Financial reported first-quarter net income of $40.3 million compared with $24.8 million in the previous quarter. The sequential improvement was driven by higher net investment income and lower operating expenses.
Net investment income was $10.6 million, which more than doubled from the previous quarter. On a per share basis, net investment income came in at 51 cents per share, substantially higher than 18 cents recorded in the prior quarter. Total expenses reduced 40.0% sequentially to $7.8 million. The decline was attributable to a reduction in incentive fees and other operating expenses.
Over the last 60 days, the Zacks Consensus Estimate for 2013 jumped 38.2% to $4.05 per share as all estimates moved north for Ellington Financial. For 2014, all the estimates moved higher, pushing the Zacks Consensus Estimate up by 7.8% to $3.17 per share.
Other Stocks to Consider
Besides Ellington Financial, other stocks in the same industry that are worth considering include Home Loan Servicing Solutions, Ltd. (HLSS) and Nationstar Mortgage Holdings Inc. (NSM) with a Zacks Rank #1, while KKR Financial Holdings LLC (KFN) carries a Zacks Rank #2 (Buy).
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