Overview

• U.S. mortgage REIT's Q2 book value per share rose to $12.90 from $12.60

• Net income per share was $0.80; dividends declared at $0.51 per share

• Investment portfolio grew 11% to $27.6 bln after $391 mln equity raise

Outlook

• Dynex Capital describes current market conditions as attractive for Agency MBS investments

• Company says platform scaling is enhancing efficiency and resilience for future returns

Result Drivers

• PORTFOLIO GROWTH - Investment portfolio grew 11% after deploying $391 mln in new equity into Agency MBS

• SPREAD TIGHTENING - Fair value of Agency MBS increased due to spread tightening late in the quarter

• EXPENSE DECLINE - Operating expenses decreased due to absence of one-time compensation and personnel costs recognized in Q1

Company press release: ID:nBw3xNNqJa

Key Details

Metric	Beat/Miss	Actual	Consensus Estimate
Q2 EPS		$0.80
Q2 Net Interest Income		$93.78 mln

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 4 "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the specialized reits peer group is "buy"

• Wall Street's median 12-month price target for Dynex Capital Inc is $14.75, about 10.7% above its July 17 closing price of $13.33

• The stock recently traded at 8 times the next 12-month earnings vs. a P/E of 9 three months ago

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