Here is why Orchid Island Capital Inc. (ORC) Stock plummeted on Thursday?

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ORC Stock
ORC Stock

Orchid Island Capital Inc. (ORC) shares declined 6.11% in after-hours on Thursday, January 13, 2022, and closed the daily trading at $4.30. Even in the regular trading session, ORC’s stock lost 0.87%. ORC shares have fallen 14.55% over the last 12 months, and they have moved down 0.65% in the past week. Over the past three months, the stock has lost 8.40%, while over the past six months, it has plunged 9.31%.

Let’s have a brief look at its recent news and developments.


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ORC Dividend declaration

On January 13, 2022, the board of directors of Orchid Island Capital, Inc. (ORC) declared a monthly cash dividend for January 2022. The dividend of $0.055 per share will be paid February 24, 2022, to holders of record of the Company’s common stock on January 31, 2022, with an ex-dividend date of January 28, 2022.

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Estimated Q4 financial results

  • The ORC’s estimated book value per share was $4.34, as of December 31, 2021.
  • Its estimated net loss per share is $0.27 which includes $0.49 per share of net realized and unrealized losses on RMBS and derivative instruments for the quarter ended December 31, 2021.
  • The estimated total return on equity for the quarter ended December 31, 2021, was 4.9%.

ORC stock repurchase program

On December 09, 2021, the board of Orchid Island Capital, Inc. approved an increase in the number of shares of the Company’s common stock available in the stock repurchase program for up to an additional 16,861,994 shares, bringing the remaining authorization under the stock repurchase program to 17,699,305 shares.

ORC initiated its share repurchases program on July 29, 2015, and on February 8, 2018, the Board approved an increase in the stock repurchase program. The Company repurchased a total of 5,685,511 shares at an aggregate cost of approximately $40.4 million, for a weighted average price of $7.10 per share till September 30, 2021. The remaining authorization under the repurchase program as of September 30, 2021, was 837,311 shares.

ORC 3rd management agreement

On November 16, 2021, Orchid Island Capital, Inc. (ORC) and Bimini Capital, Inc. jointly announced that Orchid and its external manager, Bimini Advisors, LLC entered into a Third Amendment to the Management Agreement between Orchid and the Manager. The Manager is a wholly-owned subsidiary of Bimini.

According to the agreement, the Manager will perform management services relating to the mortgage-backed securities portfolio, business activities, and day-to-day operations of Orchid and will get management fees and other expenses from Orchid.

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Conclusion

The estimated financial results and reduction in dividends were the reasons behind its poor performance on Thursday. it can continue to decline on Friday as well.

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