Cherry Hill Mortgage (CHMI) AI Stock Analysis

• Market Cap: $91.44M
• Dividend Yield: 21.43%
• Average Volume (3M): 268.69K
• Price to Earnings (P/E): 43.8
• Beta (1Y): 1.02
• Revenue Growth: 0.33%
• EPS Growth: -37.48%
• Country: US
• Employees: 12
• Sector: Real Estate
• Sector Strength: 53
• Industry: REIT - Mortgage
• EPS (TTM): 0.17
• Shares Outstanding: 32,658,447
• 10 Day Avg. Volume: 347,847
• 30 Day Avg. Volume: 268,685
• PEG Ratio: 0.10
• Price to Book (P/B): 0.44
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 5.24
• Enterprise Value/Market Cap: 2.64
• Enterprise Value/Revenue: 1.66
• Enterprise Value/Gross Profit: 15.89
• Enterprise Value/Ebitda: -788.31
• 1Y Price Target: $4.00
• Price Target Upside: 43.37% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 0

• Rating: 50 Neutral
• Price Target: $3.00 ▲(7.53%Upside)

Cherry Hill Mortgage's overall stock score is weighed down by financial volatility, high leverage, and cash flow challenges. While the high dividend yield is attractive, it comes with significant risks highlighted by the recent GAAP net loss and book value decline. Technical indicators show mixed momentum, and earnings call insights suggest caution due to market volatility. Investors should be wary of the underlying risks despite some positive operational improvements.

Cherry Hill Mortgage Business Overview & Revenue Model

Company Description

Cherry Hill Mortgage Investment Corporation, a residential real estate finance company, acquires, invests in, and manages residential mortgage assets in the United States. The company operates through Investments in RMBS (residential mortgage-backed securities), Investments in Servicing Related Assets, and All Other segments. It manages a portfolio of servicing related assets and RMBS. Cherry Hill Mortgage Investment Corporation qualifies as a real estate investment trust for federal income tax purposes. The company generally would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. Cherry Hill Mortgage Investment Corporation was incorporated in 2012 and is based in Farmingdale, New Jersey.

How the Company Makes Money

Cherry Hill Mortgage Investment Corporation makes money through a variety of revenue streams centered on its investments in mortgage-related assets. The company derives income from the interest payments on residential mortgage-backed securities (RMBS) it holds, which are pools of mortgage loans packaged together and sold as securities. Another significant source of revenue is the mortgage servicing rights (MSRs) it owns. MSRs allow the company to earn fees from servicing the underlying mortgage loans, including collecting principal and interest payments from borrowers and managing escrow accounts. Cherry Hill Mortgage also engages in hedging activities to manage interest rate risk, which can impact its earnings. The company's ability to generate income is influenced by factors such as interest rate fluctuations, housing market conditions, and the credit performance of the underlying mortgages.

Cherry Hill Mortgage Financial Statement Overview

Summary

Cherry Hill Mortgage presents a mixed financial picture. The company's income statement shows volatility with negative revenue figures and operational inefficiencies. The balance sheet highlights leverage concerns with high debt levels. Cash flow challenges persist, with negative free cash flow impacting liquidity. The company needs to stabilize its revenue stream and improve operational efficiency to strengthen its financial health.

Income Statement

Cherry Hill Mortgage's income statement shows significant volatility and negative revenue figures in recent years. The company's revenue growth rate is erratic, with a significant decline in total revenue from previous years. Although there's a positive net income in 2024, other profitability metrics like gross profit margin and EBIT margin are negative, indicating operational inefficiencies.

Balance Sheet

The balance sheet reflects a moderate financial position with a high debt-to-equity ratio, suggesting potential leverage risks. The equity ratio shows a moderate level of equity financing. Return on equity is positive for 2024, indicating some profitability, but the overall leverage remains a concern.

Cash Flow

Cash flow analysis reveals inconsistent operating cash flows with negative free cash flow in 2024, highlighting cash management challenges. The free cash flow to net income ratio is negative, indicating that net income is not translating into free cash flow, which could affect liquidity and operational flexibility.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	15.18M	34.58M	-9.95M	40.19M	28.14M	-57.32M
Gross Profit	15.18M	34.58M	-21.20M	28.36M	14.51M	-114.65M
EBITDA	0.00	0.00	-9.19M	-450.00K	13.06M	979.00K
Net Income	-6.71M	11.97M	-34.79M	21.74M	12.28M	-53.22M
Balance Sheet
Total Assets	1.45B	1.49B	1.39B	1.41B	1.30B	1.59B
Cash, Cash Equivalents and Short-Term Investments	0.00	0.00	72.39M	337.06M	1.02B	1.31B
Total Debt	149.30M	151.23M	1.10B	183.89M	145.27M	111.38M
Total Liabilities	1.22B	1.26B	1.13B	1.14B	1.02B	1.28B
Stockholders Equity	226.58M	230.34M	255.48M	262.04M	275.87M	310.17M
Cash Flow
Free Cash Flow	15.05M	-4.69M	40.66M	21.88M	-7.37M	8.24M
Operating Cash Flow	15.04M	-4.69M	40.66M	59.91M	48.01M	61.20M
Investing Cash Flow	-66.32M	-141.33M	-104.05M	-128.20M	166.52M	1.26B
Financing Cash Flow	47.82M	147.46M	67.17M	57.07M	-267.97M	-1.28B

Cherry Hill Mortgage Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2.79
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CHMI, the sentiment is Negative. The current price of 2.79 is below the 20-day moving average (MA) of 2.79, below the 50-day MA of 2.83, and below the 200-day MA of 2.80, indicating a bearish trend. The MACD of >-0.01 indicates Negative momentum. The RSI at 49.21 is Neutral, neither overbought nor oversold. The STOCH value of 44.06 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CHMI.

Cherry Hill Mortgage Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
LOAN	71 Outperform	$61.77M	11.25	12.70%	8.52%	-5.84%	-3.44%
ACR	60 Neutral	$130.51M	61.85	5.47%	―	-13.68%	-53.53%
LFT	56 Neutral	$108.83M	10.45	6.38%	11.54%	-10.98%	-35.75%
Sector *	54 Neutral	$1.20B	3.61	0.13%	7.01%	-2.13%	-128.06%
CHMI	50 Neutral	$91.44M	43.78	-2.83%	21.43%	0.33%	-37.48%
GPMT	49 Neutral	$123.92M	―	-20.41%	7.81%	-26.87%	-189.15%
SACH	47 Neutral	$61.03M	―	-20.80%	15.50%	-55.51%	-493.18%

Cherry Hill Mortgage Corporate Events

Cherry Hill Mortgage Expands Board and Adopts Severance Plan

On March 11, 2025, Cherry Hill Mortgage Investment Corporation expanded its Board of Directors from four to five members by appointing Dale S. Hoffman as a new director. Hoffman’s appointment, which includes roles on the compensation and nominating and corporate governance committees, is set to last until the 2025 annual stockholders meeting. The following day, March 12, 2025, the company adopted an Executive Severance Plan, effective immediately, covering key executives such as the CEO and CFO. The plan outlines conditions for severance payments in the event of qualifying terminations, including specific financial benefits and restrictive covenants.