Ellington Financial Stock Earnings Reports

Ellington Financial reported a very strong Q1 2026: GAAP net income of $0.78 per share and adjusted distributable earnings (ADE) of $0.55 per share. Management raised ADE run-rate guidance to the ~ $0.45 per quarter area (above the $0.39 dividend). Longbridge (reverse-mortgage origination & servicing affiliate) was the standout contributor, producing near‑record originations, strong gain-on-sale margins, securitization benefits (lowest-ever funding costs on their PropReverse deal), servicing gains, and a one-time $17M litigation settlement. Securitization activity was high (seven transactions, >$2.8B), increasing scale and improving economics; non-QM average deal size nearly doubled year-over-year. The credit portfolio grew ~4% (net of securitizations), delinquencies declined for a second consecutive quarter, and realized credit losses remain minimal. Book value per share rose to $13.56 (+3% sequentially), helped by fair-value mark-ups on unsecured liabilities during a period of higher rates/spreads. Balance-sheet moves included a $117M common equity raise used to redeem high-cost preferred stock, unencumbered assets increasing to ~$1.9B, recourse debt-to-equity at 1.9x and overall debt-to-equity at 9x, and continued emphasis on replacing short-term repo with long-term unsecured funding when market conditions allow. Management expects ADE to remain above the dividend, plans opportunistic unsecured issuance, continues pursuit of a mortgage servicer acquisition (regulatory approval pending), and is focused on scaling securitizations and using technology (including AI) to drive efficiency. They noted market risks from spread volatility and macro drivers (rates, inflation, geopolitics), but highlighted diversification, vertical integration, and strong credit performance as buffers.