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DX Dynex Capital

ynex Capital, Inc. is an internally managed real estate investment trust, or REIT, which invests in mortgage assets on a leveraged basis. The Company invests in Agency and non-Agency RMBS, CMBS, and CMBS IO.

Company profile

Ticker
DX, DX-PC
Exchange
CEO
Thomas Akin
Employees
Incorporated
Location
Fiscal year end
Former names
RESOURCE MORTGAGE CAPITAL INC/VA
SEC CIK
IRS number
521549373

DX stock data

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Calendar

3 May 21
24 Jun 21
31 Dec 21
Quarter (USD)
Mar 21 Dec 20 Sep 20 Jun 20
Revenue
Cost of revenue
Operating income
Operating margin
Net income
Net profit margin
Cash on hand
Change in cash
Diluted EPS
Annual (USD)
Dec 20 Dec 19 Dec 18 Dec 17
Revenue
Cost of revenue
Operating income
Operating margin
Net income
Net profit margin
Cash on hand
Change in cash
Diluted EPS

Financial data from company earnings reports.

Date Owner Security Transaction Code Indirect 10b5-1 $Price #Shares $Value #Remaining
26 May 21 Byron L Boston Common Stock Grant Aquire A No No 0 25,345 0 345,577
26 May 21 Stephen J Benedetti Common Stock Grant Aquire A No No 0 12,672 0 161,109.53
26 May 21 Smriti Laxman Popenoe Common Stock Grant Aquire A No No 0 17,002 0 106,206
14 May 21 Salcetti Robert A Common Stock Grant Aquire A No No 0 4,661 0 41,179
14 May 21 Coronado Julia Lynn Common Stock Grant Aquire A No No 0 4,661 0 4,661

Data for the last complete 13F reporting period. To see the most recent changes to ownership, click the ownership history button above.

48.0% owned by funds/institutions
13F holders
Current Prev Q Change
Total holders 121 124 -2.4%
Opened positions 22 24 -8.3%
Closed positions 25 13 +92.3%
Increased positions 45 42 +7.1%
Reduced positions 25 33 -24.2%
13F shares
Current Prev Q Change
Total value 527.27M 320.97M +64.3%
Total shares 14.82M 11.75M +26.2%
Total puts 125.6K 585.4K -78.5%
Total calls 65K 832.1K -92.2%
Total put/call ratio 1.9 0.7 +174.7%
Largest owners
Shares Value Change
BLK Blackrock 2.54M $48.11M +17.8%
FMR 2.27M $42.93M -0.0%
Vanguard 1.45M $27.42M +37.7%
Mirae Asset Global Investments 798.98K $15.13M NEW
STT State Street 710.63K $13.53M +10.8%
Marshall Wace 665.67K $12.6M NEW
RY Royal Bank Of Canada 640.03K $12.12M -2.4%
Geode Capital Management 408.69K $7.74M +22.8%
WFC Wells Fargo & Co. 354.78K $6.72M +121.7%
Caas Capital Management 308.07K $5.83M NEW
Largest transactions
Shares Bought/sold Change
Mirae Asset Global Investments 798.98K +798.98K NEW
Marshall Wace 665.67K +665.67K NEW
Vanguard 1.45M +396.57K +37.7%
BLK Blackrock 2.54M +383.85K +17.8%
Caas Capital Management 308.07K +308.07K NEW
WFC Wells Fargo & Co. 354.78K +194.73K +121.7%
Citadel Advisors 246.48K +123.15K +99.8%
Jupiter Asset Management 122.13K +122.13K NEW
Matarin Capital Management 0 -108.92K EXIT
Arrowstreet Capital, Limited Partnership 0 -93.55K EXIT

Financial report summary

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Risks
  • Fluctuations in interest rates could negatively impact our net interest income, comprehensive income, book value per common share, dividends, and liquidity.
  • As a result of monetary easing policies, the Federal Reserve has lowered the Federal Funds Rate and now owns substantial amounts of longer-term Treasury securities and fixed-rate Agency MBS in order to put downward pressure on interest rates. If the Federal Reserve begins tightening monetary policy or if the FRBNY were to sell these securities or even announce that it intends to sell these securities, longer-term interest rates are likely to increase dramatically which could negatively impact the market value of our investments. In addition, an announcement by the Federal Reserve of its intention to increase the targeted Federal Funds rate, or the market’s anticipation of such an announcement, is likely to increase our borrowing costs.
  • We invest in assets that are traded in over-the-counter (“OTC”) markets which are less liquid and have less price transparency than securities exchanges. Owning securities that are traded in OTC markets may increase our liquidity risk, particularly in a volatile market environment, because our assets may be more difficult to borrow against or sell in a prompt manner and on terms acceptable to us, and we may not realize the full value at which we previously recorded the investments and/or may incur losses upon sale of these assets.
  • Provisions requiring yield maintenance charges, prepayment penalties, defeasance, or lock-outs in CMBS IO securities may not be enforceable.
  • We invest in securities guaranteed by Fannie Mae and Freddie Mac which are currently under conservatorship by the Federal Housing Finance Authority (“FHFA”). The ultimate impact on the operations of Fannie Mae and Freddie Mac from the conservatorships and the support they receive from the U.S. government is not determinable and could affect Fannie Mae and Freddie Mac in such a way that our business, operations and financial condition may be adversely affected.
  • Our repurchase agreements and agreements governing certain derivative instruments may contain financial and nonfinancial covenants. Our inability to meet these covenants could adversely affect our financial condition, results of operations, and cash flows.
  • Our use of hedging strategies to mitigate our interest rate risk may not be effective and may adversely affect our net income, comprehensive income, liquidity, shareholders’ equity and book value per common share.
  • Clearing facilities or exchanges may increase the margin requirements we are required to post when entering into derivative instruments, which may negatively impact our ability to hedge and our liquidity.
  • If a lender to us in a repurchase transaction defaults on its obligation to resell the underlying security back to us at the end of the transaction term, or if we default on our obligations under a repurchase agreement, we will incur losses.
  • In the event of bankruptcy either by ourselves or one or more of our third-party lenders, under the U.S. Bankruptcy Code, assets pledged as collateral under repurchase agreements may not be recoverable by us. We may incur losses equal to the excess of the collateral pledged over the amount of the associated repurchase agreement borrowing.
  • If we fail to properly conduct our operations, we could become subject to regulation under the 1940 Act. Conducting our business in a manner so that we are exempt from registration under and compliance with the 1940 Act may reduce our flexibility and could limit our ability to pursue certain opportunities.
  • Qualifying as a REIT involves highly technical and complex provisions of the Code, and a technical or inadvertent violation could jeopardize our REIT qualification. Maintaining our REIT status may reduce our flexibility to manage our operations.
  • If we do not qualify as a REIT or fail to remain qualified as a REIT, we may be subject to tax as a regular corporation and could face a tax liability, which would reduce the amount of cash available for distribution to our shareholders. We would also violate debt covenants in certain repurchase and derivative agreements which could put us in default on these agreements.
  • Dividends payable by REITs do not qualify for the reduced tax rates available for some dividends.
  • Legislative or other actions affecting REITs could materially and adversely affect us and our shareholders.
  • Our ability to invest in and dispose of TBA securities could be limited by our REIT status, and we could lose our REIT status as a result of these investments.
  • For REIT test purposes, we treat repurchase agreement transactions as financing of the investments pledged as collateral. If the IRS disagrees with this treatment our ability to qualify as a REIT could be adversely affected.
  • Even if we remain qualified as a REIT, we may face other tax liabilities that reduce our cash flow and our profitability.
  • Recognition of excess inclusion income by us could have adverse consequences to us or our shareholders.
  • The stock ownership limit imposed by the Code for REITs and our Restated Articles of Incorporation (“Articles of Incorporation”) may restrict our business combination opportunities. The stock ownership limitation may also result in reduced liquidity in our stock and may result in losses to an acquiring shareholder.
  • The stock ownership limit imposed by the Code for REITs and our Articles of Incorporation may impair the ability of holders to convert shares of our outstanding preferred stock into shares of our common stock upon a change of control.
  • Impacts from COVID-19may continue to adversely affect market conditions which in turn could further impact our business, financial condition, liquidity and results of operations. Furthermore, we cannot predict the effect that government policies, laws, and plans adopted in response to the COVID-19 outbreak or other future outbreaks involving highly infectious or contagious diseases and resulting recessionary economic conditions will have on us.
  • The replacement of LIBOR with an alternative reference rate may adversely affect our profitability, liquidity, and financial condition.
  • We may change our investment strategy, operating policies, dividend policy, and/or asset allocations without shareholder consent and/or in a manner in which shareholders, analysts, and capital markets may not agree, which could adversely affect our financial condition, results of operations, the market price of our common stock, and our ability to pay dividends to our shareholders.
  • Competition may prevent us from acquiring new investments at favorable yields, and we may not be able to achieve our investment objectives which may potentially have a negative impact on our profitability.
  • We are highly dependent on information and communication systems and third parties, and systems failures or cybersecurity incidents could significantly disrupt our business or lead to significant losses, which may, in turn, negatively affect the market price of our common and preferred stocks and our ability to operate our business.
Management Discussion
  • The discussion below includes both GAAP and non-GAAP financial measures that management utilizes in its internal analysis of financial and operating performance. Please read the section “Non-GAAP Financial Measures” contained in “Executive Overview” of Item 2 of this Quarterly Report on Form 10-Q for additional important information about these measures.
  • Net interest income decreased $2.2 million for the three months ended March 31, 2021 compared to the three months ended December 31, 2020 due to a smaller average balance of lower yielding investments. Net interest spread declined 7 basis points for the three months ended March 31, 2021 compared to the prior quarter, but exceeded management's expectation for the first quarter of 2021 as prepayment speeds were lower than anticipated and financing rates dropped 5 basis points versus the prior quarter.
  • (1) Average balance for assets is calculated as a simple average of the daily amortized cost and excludes unrealized gains and losses as well as securities pending settlement if applicable.
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