JFrog stock rises as Cantor Fitzgerald maintains Overweight rating after strong Q2
Ellington Financial Inc. (NYSE:EFC), a $1.2 billion market cap financial firm with a notable 11.76% dividend yield, has entered into a new management agreement, effective April 1, 2025, which updates and simplifies certain terms of its existing contract. The agreement was unanimously approved by the company’s board on Monday. According to InvestingPro data, the company maintains a strong financial health score and currently trades at an attractive P/E ratio of 9.6x.
The updated Eighth Amended and Restated Management Agreement introduces changes to the existing Seventh Amended and Restated Management Agreement from March 13, 2018. The modifications include updating corporate form references, refining expense reimbursement provisions, and simplifying the calculation of the "Hurdle Amount" for incentive fee purposes. This simplification is not expected to materially impact the fee payable to the manager. Notably, EFC has maintained consistent dividend payments for 16 consecutive years, demonstrating strong corporate governance practices. InvestingPro analysis suggests the stock is currently trading below its Fair Value, presenting a potential opportunity for value investors.
The new definition for calculating the Hurdle Amount involves multiplying stockholders’ common equity at the end of the preceding fiscal quarter by the Hurdle Rate, adjusted for any common stock issuances or repurchases during the quarter. This contrasts with the previous, more complex methodology that included weighted average gross proceeds per share or unit and retained earnings attributable to common shares and units.
The initial term of the New Management Agreement will expire on December 31, 2025, with automatic one-year renewals unless terminated earlier as per the agreement’s terms. Other than the described amendments, the new agreement does not materially change the terms of the existing management contract.
This move comes as part of Ellington Financial’s ongoing adjustments following its transition from a limited liability company to a corporation. The information is based on a press release statement filed with the SEC. For a comprehensive analysis of EFC’s financial health, growth prospects, and valuation metrics, investors can access the detailed Pro Research Report available on InvestingPro, which covers over 1,400 US stocks with expert insights and actionable intelligence.
In other recent news, Ellington Financial reported its fourth-quarter results for 2024, revealing an earnings per share (EPS) of $0.45, which exceeded analyst expectations of $0.39. Despite this earnings beat, the company reported a revenue of $71.97 million, falling short of the anticipated $76.83 million. In addition to these financial results, Ellington Financial declared dividends for both common and preferred stockholders, with a monthly dividend of $0.13 per share for common stock and varying amounts for preferred shares. The company has also been in the spotlight with Keefe, Bruyette & Woods analyst Bose T. George raising the price target for Ellington Financial shares to $14.50, maintaining an Outperform rating based on the firm’s stable performance and mortgage banking operations.
Ellington Financial’s diverse portfolio, including residential and commercial mortgage loans, has been a focal point for analysts, with the company maintaining strong returns to support its dividend. The company emphasized its strategic focus on securitization and innovative financial products, which have contributed to its robust performance. Furthermore, Ellington Financial’s management highlighted ongoing efforts in securitization and the development of new senior-focused financial products. These recent developments underscore the company’s commitment to maintaining dividend coverage and expanding its financial product offerings.
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