Orchid Island (ORC) Dividend Payouts Could Limit Book Value Growth, Says Compass Point

Orchid Island Capital, Inc. (NYSE:ORC) ranks among the most undervalued REIT stocks to buy right now. On December 15, Compass Point began coverage of Orchid Island Capital, Inc. (NYSE:ORC), rating it Neutral and setting a $7.50 price target on the stock. Compass Point said that political and policy concerns will come out as significant factors for mortgage asset performance in the following quarters, generating prospects for MBS investors.

Even with these favorable aspects, Compass Point was concerned that Orchid Island Capital’s substantial dividend payout compared to core ROE and GAAP earnings would keep stifling book value per share growth.

More recently, on January 14, Orchid Island Capital, Inc. (NYSE:ORC) announced its preliminary projections for the fourth quarter of 2025, forecasting a book value per share of $7.54 and a net income per share of $0.62, including $0.43 in realized and unrealized profit on residential mortgage-backed securities (RMBS) and derivatives.

Orchid Island Capital, Inc. (NYSE:ORC) is a specialty finance company that invests on a leveraged basis in Agency residential mortgage-backed securities.

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Disclosure: None. This article is originally published at Insider Monkey.