Dynex Capital Inc. Earnings: Five Straight Quarters of Double-Digit Growth

Dynex Capital Inc. (NASDAQ:DX) reported its results for the second quarter. Dynex Capital, Inc. is a real estate investment trust, which invests in mortgage loans and securities on a leveraged basis.

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Dynex Capital Earnings Cheat Sheet for the Second Quarter

Results: Net income for the real estate investment trust rose to $13.6 million (34 cents per share) vs. $7.3 million (38 cents per share) in the same quarter a year earlier. This marks a rise of 87.1% from the year earlier quarter.

Actual vs. Wall St. Expectations: DX beat the mean analyst estimate of 33 cents per share.

Quoting Management: Thomas Akin, Chairman and Chief Executive Officer, commented, “We invested the remaining proceeds from our March 2011 capital raise during the second quarter and stand fully invested at June 30, 2011. Our overall leverage is now at 5.9 times equity capital, which is within our target leverage range. Most of the investment activity during the second quarter was in Hybrid Agency ARMs and consequently the investment portfolio is now more heavily weighted to Agency MBS versus our targeted mix of 60% Agency and 40% non-Agency investments. We have recently seen attractive risk-adjusted opportunities in non-Agency investments and expect to deploy capital in these investments over the balance of the year as we move toward our targeted investment mix. That said, we are pleased with the investments we added during the second quarter given our strong earnings and growth in book value per common share during the quarter. Our net interest spread is a solid 2.45%, our leverage is at our target, and our portfolio remains extremely high quality with 94% either Agency or ‘AAA’-rated.”

Key Stats:

The company has now seen net income rise in three straight quarters. In the first quarter, net income rose 85.7% and in the fourth quarter of the last fiscal year, the figure rose more than twofold.

Competitors to Watch: PennyMac Mortgage Investment Trust (NYSE:PMT), Redwood Trust, Inc. (NYSE:RWT), Anworth Mortgage Asset Corp. (NYSE:ANH), New York Mortgage Trust, Inc. (NASDAQ:NYMT), ARMOUR Residential REIT, Inc. (AMEX:ARR), American Capital Agency Corp. (NASDAQ:AGNC), MFA Financial, Inc. (NYSE:MFA).

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(Source: Xignite Financials)