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Its first-quarter 2025 results reflected a year-over-year improvement in average asset yield on its portfolio. However, higher expenses remained an undermining factor.
Orchid Island has a decent earnings surprise history. Its earnings outpaced the Zacks Consensus Estimate in two of the trailing four quarters, missed once and matched once, with the average earnings surprise being 101.39%.
Orchid Island Capital, Inc. Price and EPS Surprise
In the past seven days, the consensus estimate for earnings has been unchanged at 15 cents. This suggests a 266.7% jump from the prior-year quarter.
Major Factors to Impact ORC’s Q2 Performance
Despite interest rate cuts by the Federal Reserve in 2024, mortgage rates did not come down meaningfully. In the second quarter, mortgage rates fluctuated, but they remained in the mid-to-upper 6% range. As such, refinancing activities and origination volumes witnessed decent growth.
Amid this, a large part of Orchid Capital’s mortgage-backed securities (MBS) holdings is anticipated to have witnessed higher levels of constant prepayment rates.
This is expected to have positively impacted ORC’s net premium amortization in the second quarter, in turn, supporting growth in interest income and average asset yield.
The primary-secondary spread has averaged 1.06% in the second quarter of 2025, below the first quarter’s average of 1.12%. Due to increased volatility in the market, the primary-secondary spread may be slightly skewed. As such, ORC’s gain on sale margins in the second quarter of 2025 is likely to have been relatively steady.
With primary-secondary spreads relatively stable and increased mortgage rate volatility, ORC is likely to have seen a decline in its book value per share in the quarter to be reported.
What Our Model Unveils for Orchid Island
Our proven model does not conclusively predict an earnings beat for ORC this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Earnings ESP: Orchid Island has an Earnings ESP of 0.00%.
Here are a couple of REIT stocks that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this time:
The Earnings ESP for Angel Oak Mortgage REIT, Inc. (AOMR - Free Report) is +3.70% and it carries a Zacks Rank #3 at present. The company is likely to report second-quarter 2025 results in the coming days. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)
Over the past week, the Zacks Consensus Estimate for AOMR’s quarterly earnings has been revised 3.6% lower to 27 cents per share.
ARMOUR Residential REIT, Inc. (ARR - Free Report) is also expected to release second-quarter 2025 numbers soon. The company has an Earnings ESP of +1.86% and carries a Zacks Rank #3 at present.
Quarterly earnings estimates for ARR have been revised 1.2% lower to 81 cents per share over the past week.
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Orchid Island Set to Release Q2 Earnings: What to Expect
Key Takeaways
Orchid Island Capital, Inc. (ORC - Free Report) is slated to report second-quarter 2025 earnings on July 24, after market close.
Its first-quarter 2025 results reflected a year-over-year improvement in average asset yield on its portfolio. However, higher expenses remained an undermining factor.
Orchid Island has a decent earnings surprise history. Its earnings outpaced the Zacks Consensus Estimate in two of the trailing four quarters, missed once and matched once, with the average earnings surprise being 101.39%.
Orchid Island Capital, Inc. Price and EPS Surprise
Orchid Island Capital, Inc. price-eps-surprise | Orchid Island Capital, Inc. Quote
In the past seven days, the consensus estimate for earnings has been unchanged at 15 cents. This suggests a 266.7% jump from the prior-year quarter.
Major Factors to Impact ORC’s Q2 Performance
Despite interest rate cuts by the Federal Reserve in 2024, mortgage rates did not come down meaningfully. In the second quarter, mortgage rates fluctuated, but they remained in the mid-to-upper 6% range. As such, refinancing activities and origination volumes witnessed decent growth.
Amid this, a large part of Orchid Capital’s mortgage-backed securities (MBS) holdings is anticipated to have witnessed higher levels of constant prepayment rates.
This is expected to have positively impacted ORC’s net premium amortization in the second quarter, in turn, supporting growth in interest income and average asset yield.
The primary-secondary spread has averaged 1.06% in the second quarter of 2025, below the first quarter’s average of 1.12%. Due to increased volatility in the market, the primary-secondary spread may be slightly skewed. As such, ORC’s gain on sale margins in the second quarter of 2025 is likely to have been relatively steady.
With primary-secondary spreads relatively stable and increased mortgage rate volatility, ORC is likely to have seen a decline in its book value per share in the quarter to be reported.
What Our Model Unveils for Orchid Island
Our proven model does not conclusively predict an earnings beat for ORC this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Earnings ESP: Orchid Island has an Earnings ESP of 0.00%.
Zacks Rank: Orchid Island currently carries a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.
REIT Stocks to Consider
Here are a couple of REIT stocks that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this time:
The Earnings ESP for Angel Oak Mortgage REIT, Inc. (AOMR - Free Report) is +3.70% and it carries a Zacks Rank #3 at present. The company is likely to report second-quarter 2025 results in the coming days. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)
Over the past week, the Zacks Consensus Estimate for AOMR’s quarterly earnings has been revised 3.6% lower to 27 cents per share.
ARMOUR Residential REIT, Inc. (ARR - Free Report) is also expected to release second-quarter 2025 numbers soon. The company has an Earnings ESP of +1.86% and carries a Zacks Rank #3 at present.
Quarterly earnings estimates for ARR have been revised 1.2% lower to 81 cents per share over the past week.