Ellington Financial Inc. Initiates Agreement to Offer $300 Million in Common Stock – What Investors Need to Know
Ellington Financial Inc. (NYSE:) has disclosed the initiation of a material agreement that could see the company offer and sell common stock up to $300 million. This strategic move aims to increase liquidity and fund investment activities. Multiple financial institutions, including Citizens JMP Securities LLC and UBS Securities LLC, will act as agents or resellers in the stock offering process.
The shares will be offered through "at the market" offerings on the New York Stock Exchange, with agents receiving up to 2% in commissions. Armstrong Securities LLC, a subsidiary of Ellington Financial Inc., is also participating in the offering. The company's recent strong financial performance and dividend strategy make this offering attractive to potential investors.
Ellington Financial's second-quarter results for 2024 were impressive, with a non-annualized economic return of 4.5% and an increase in adjusted distributable earnings per share. Despite challenges such as an increase in borrowing rates and delinquency percentages, the company remains poised for growth. Future expectations include increased loan origination volumes and asset additions.
InvestingPro data shows Ellington Financial's favorable market capitalization and P/E ratio, suggesting it may be undervalued. The company's consistent dividend payments and high dividend yield of 12.1% make it appealing to income-focused investors. With profitability over the last twelve months and liquid assets exceeding short-term obligations, Ellington Financial's financial health is strong.
As the company moves forward with its stock offering, investors can utilize InvestingPro's additional tips to assess the potential impact on shareholder value. Ellington Financial's strategic decisions and financial performance indicate a promising outlook for investors looking to capitalize on this opportunity.