Does Chimera Investment Corporation (CIM) offer a good opportunity for investors?

Chimera Investment Corporation (NYSE: CIM) stock fell -9.52% on Friday to $6.84 against a previous-day closing price of $7.56. With 10.13 million shares changed hands, the volume of the stock remained heavier than its average volume of 1.94 million shares. During the session, the REIT – Mortgage company that operates in wider Real Estate sector, reached to the highest price of $7.22 whereas the lowest price it dropped to was $6.70. The 52-week range on CIM shows that it touched its highest point at $16.85 and its lowest point at $7.56 during that stretch. It currently has a 1-year price target of $9.38. With its current market cap of 1.57 billion, CIM has annualized dividend of $1.32 while the current yield stands at 19.30%. Beta for the stock currently stands at 1.15.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of CIM was down-trending over the past week, with a drop of -11.97%, but this was down by -23.06% over a month. Three-month performance dropped to -22.89% while six-month performance fell -44.34%. The stock lost -55.29% in the past year, while it has lost -54.64% so far this year. A look at the trailing 12-month EPS for CIM yields -0.67 with Next year EPS estimates of 1.23. For the next quarter, that number is 0.28. This implies an EPS growth rate of -25.80% for this year and -7.27% for next year. EPS is expected to decline by -2.54% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of -3.60%.

Float and Shares Shorts:

At present, 235.31 million CIM shares are outstanding with a float of 228.62 million shares on hand for trading. On Jul 14, 2022, short shares totaled 11.33 million, which was 4.78% higher than short shares on Jun 14, 2022. In addition to Mr. Mohit Marria as the firm’s CEO, Chief Investment Officer & Director, Mr. Choudhary Yarlagadda serves as its Pres, COO & Director.

Institutional Ownership:

Through their ownership of 50.91% of CIM’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 33.19% of CIM, in contrast to 2.55% held by mutual funds. Shares owned by individuals account for 17.76%. As the largest shareholder in CIM with 9.44% of the stake, The Vanguard Group, Inc. holds 21,872,083 shares worth 21,872,083. A second-largest stockholder of CIM, BlackRock Fund Advisors, holds 17,357,862 shares, controlling over 7.49% of the firm’s shares. Thornburg Investment Management, is the third largest shareholder in CIM, holding 17,331,693 shares or 7.48% stake. With a 7.47% stake in CIM, the Thornburg Investment Income Build is the largest stakeholder. A total of 17,317,311 shares are owned by the mutual fund manager. The Vanguard Total Stock Market Index, which owns about 3.13% of CIM stock, is the second-largest Mutual Fund holder. It holds 7,241,328 shares valued at 61.55 million. Vanguard Small Cap Index Fund holds 2.59% of the stake in CIM, owning 6,004,622 shares worth 51.04 million.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for CIM since 7 analysts follow the stock currently. There are 1 analysts who recommend BUY ratings, while 1 suggest SELL ratings. Of the remaining analysts, 5 believe that the stock is worth HOLDING, 0 give it an OVERWEIGHT rating, and 0 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With CIM analysts setting a high price target of $11.00 and a low target of $8.00, the average target price over the next 12 months is $9.38. Based on these targets, CIM could surge 60.82% to reach the target high and rise by 16.96% to reach the target low. Reaching the average price target will result in a growth of 37.13% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. CIM will report FY 2022 earnings on 02/15/2023. Analysts have provided yearly estimates in a range of $1.40 being high and $1.23 being low. For CIM, this leads to a yearly average estimate of $1.33. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. Chimera Investment Corporation surprised analysts by -$0.02 when it reported $0.31 EPS against a consensus estimate of $0.33. The surprise factor in the prior quarter was $0.02. Based on analyst estimates, the high estimate for the next quarter is $0.33 and the low estimate is $0.26. The average estimate for the next quarter is thus $0.31.

Summary of Insider Activity:

Insiders traded CIM stock several times over the past three months with 0 Buys and 0 Sells. In these transactions, 0 shares were bought while 0 shares were sold. The number of buy transactions has increased to 14 while that of sell transactions has risen to 3 over the past year. The total number of shares bought during that period was 332,945 while 54,028 shares were sold.

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