Key Highlights

  • Chimera Investment (CIM) pays $0.45 per quarter, a Yield of about 17.29%; the next ex-dividend date is Sept. 30.
  • State Street Corp increased its position in CIM.
  • About $17.30 million traded versus a typical $10.44 million, and the 14-day RSI is 27.0.

Chimera Investment (NYSE:CIM) rose 0.9% to $10.50 in pre-market trading after State Street increased its stake, but the Mortgage REIT is down 18.3% this year and closed near its session low. CIM yields about 17.3%, trades at 0.6 times book value, and its RSI of 27.0 is oversold, while Q2 Earnings only just covered the $0.45 dividend.

Chimera's Dividend yield stands at about 17.3 percent. Chimera invests in residential mortgage loans, including non-agency loans that do not carry a government guarantee, along with mortgage securities and business-purpose loans. Its returns depend on borrower Credit as well as interest rates.

Coverage is tight. Q2 earnings available for distribution were $0.46 per share, missing the $0.52 consensus and barely covering the $0.45 dividend. KBW cut its target to $14. The stock's Price-to-Book Ratio of 0.6 shows the market is pricing in pressure on Book Value as the 10-year Treasury Yield sits near its highest level since 2007.

Chimera Investment (CIM) Volume Rises but Shares Close Weak

The $0.34 move equaled about 1.4x the 14-day average true range of $0.24. CIM traded between $10.38 and $10.79 and finished near the low. It is down 10.4% over the past month. The market Capitalization is about $871.44 million, with 83,711,380 shares outstanding and $444.04 million of cash.

CIM Technical Levels

CIM trades below its major moving averages. The 14-day RSI is 27.0. RSI measures buying versus selling pressure on a 0 to 100 scale, and readings under 30 are oversold, often a point where declines slow.

MACD is -0.30, below its -0.27 signal line. MACD tracks momentum, and a reading below the signal line means sellers still have the edge.

ADX is 44.4. ADX measures trend strength, and readings above 40 signal a strong downtrend.

Resistance is $10.53, then $10.99. Support is the $10.38 session low.

Fundamentals and Analyst View

Trailing-twelve-month Revenue rose 14.4% to $916.89 million. Net Margin was only 0.1%, and debt-to-equity is 5.57. Analysts rate CIM Hold with an average target near $14.17, about 35% above the current price.