The equity market is a powerful mechanism as daily fluctuations in price get aggregated to incredible wealth creation or destruction over the long term. Pacifica Yield aims to pursue long-term wealth creation with a focus on undervalued yet high-growth companies, high-dividend tickers, REITs, and green energy firms.Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote thi ...

Core Viewpoint - The equity market serves as a significant mechanism for wealth creation or destruction over the long term, with Pacifica Yield focusing on undervalued high-growth companies, high-dividend stocks, REITs, and green energy firms [1] Group 1 - Pacifica Yield aims to pursue long-term wealth creation [1] - The strategy includes a focus on undervalued yet high-growth companies [1] - High-dividend tickers, REITs, and green energy firms are also key areas of interest [1]

PresentationGood morning. My name is Alicia, and I'll be your conference facilitator. At this time, I'd like to welcome everyone to Granite Point Mortgage Trust's Third Quarter 2025 Financial Results Conference Call. [Operator Instructions] Please note today's call is being recorded.Chris PettaInvestor Relations Officer Thank you, and good morning, everyone. Thank you for joining our call to discuss Granite Point's third quarter 2020 financial results. With me on the call this morning are Jack Taylor, our P ...

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Financial Data and Key Metrics Changes - The company reported a GAAP net loss attributed to common stockholders of $0.6 million or negative $0.01 per basic common share, which includes a benefit from credit losses of $1.6 million or $0.03 per basic common share [17] - Distributable loss for the quarter was $18.9 million or negative $0.40 per basic common share, including write-offs of $19.8 million or $0.42 per basic common share [17] - The book value as of September 30th was $7.94 per common share, a decline of $0.05 per share from Q2 [18] - The aggregate CECL reserve at September 30th was about $134 million, down from $155 million last quarter [18] - Total leverage decreased slightly from 2.1 times to 1.9 times [19] Business Line Data and Key Metrics Changes - The total loan portfolio commitments ended the third quarter at $1.8 billion, with an outstanding principal balance of $1.7 billion [11] - The realized loan portfolio yield for the third quarter was 7.5%, up from 7.1% in the prior quarter [11][12] - The weighted average risk rating of the portfolio held steady at 2.8 [11] Market Data and Key Metrics Changes - Investor sentiment improved through the third quarter, with increased confidence in deploying capital into the recovering commercial real estate market [5] - The commercial real estate market remains uneven, with the middle market loan segment being compelling for certain property types like multifamily and industrial [6] Company Strategy and Development Direction - The company plans to focus on loan repayments and asset resolutions while maintaining higher levels of liquidity, expecting to return to core lending and origination efforts in mid-2026 [9][16] - The company is actively repositioning REO assets and investing capital to maximize outcomes [7][16] Management's Comments on Operating Environment and Future Outlook - Management noted that while the re-liquidation of the commercial real estate market is underway, it remains uneven and bifurcated [6] - The company anticipates a longer resolution timeline for certain loans due to persistent local market challenges, but sees positive trends in the return to office mandates [15] Other Important Information - The company reduced the balance of its higher-cost secured credit facility by $7.5 million and extended the maturity to December 2026 [10] - The company had about $63 million of unrestricted cash at the end of the quarter [19] Q&A Session Summary Question: What are the company's plans for asset resolutions and growth? - Management emphasized the ongoing efforts to resolve assets and position for regrowth in 2026, highlighting the team's dedication to these plans [21]

Financial Performance - The company reported a GAAP Net Loss attributable to common stockholders of $0.6 million, or $(0.01) per basic weighted average common share[8, 13] - Distributable Earnings (Loss) was $(18.9) million, or $(0.40) per basic weighted average common share[7, 8] - Distributable Earnings (Loss) Before Realized Gains and Losses was $0.9 million, or $0.02 per basic weighted average common share[8] Portfolio Overview - The total loan portfolio commitments reached $1.8 billion across 44 loan investments[7, 8] - The unpaid principal balance (UPB) of the loan portfolio was $1.7 billion[7, 25] - The weighted average stabilized Loan-to-Value (LTV) at origination was 65.0%[7, 24, 25] - The company held two Real Estate Owned (REO) assets with an aggregate carrying value of $105.5 million[7, 8] - The total CECL reserve was $133.6 million, representing 7.4% of total loan portfolio commitments[7, 8] Capitalization and Liquidity - The company had $62.7 million in unrestricted cash[7, 8, 10] - The Total Leverage Ratio was 1.9x[7, 8]

Core Insights - Granite Point Mortgage Trust Inc. reported a GAAP net loss attributable to common stockholders of $(0.6) million, or $(0.01) per basic weighted average common share, which included a benefit from credit losses of $1.6 million [4] - The company declared a common stock dividend of $0.05 per share and a cash dividend of $0.4375 per share for its Series A preferred stock [4] - The total loan portfolio experienced a net activity of $(109.7) million in unpaid principal balance, with $(72.4) million in loan repayments [4] Financial Performance - Distributable Earnings (Loss) for the quarter was $(18.9) million, or $(0.40) per basic weighted average common share [4] - Distributable Earnings (Loss) Before Realized Gains and Losses was $0.9 million, or $0.02 per basic weighted average common share [4] - The book value per common share was $7.94, which included $(2.82) per common share of total CECL reserve [4] Loan Portfolio and Risk Management - The company carried a 97% floating rate loan portfolio with total loan commitments of $1.8 billion, comprised of over 99% senior loans [4] - The weighted average stabilized loan-to-value (LTV) at origination was 65.0%, with a realized loan portfolio yield of 7.5% [4] - The total CECL reserve stood at $133.6 million, representing 7.4% of total loan portfolio commitments [4] Post Quarter-End Update - In Q4 2025, the company funded approximately $2.3 million on existing loan commitments and received a full loan repayment of $32.7 million [4] - The maturity of the secured credit facility was extended to December 2026, and the financing spread was reduced by 75 basis points [4] - As of November 3, 2025, the company held approximately $80.1 million in unrestricted cash [4]

Financial Performance - For the three months ended September 30, 2025, the company recorded a GAAP net loss per basic common share of $(0.01) and a Distributable Loss of $(0.40) per basic common share[156]. - The company recognized a GAAP net loss attributable to common stockholders of $(0.6) million for the quarter[158]. - For the three months ended September 30, 2025, the GAAP net loss attributable to common stockholders was $(565,000), compared to a loss of $(34,624,000) in the same period of 2024[165]. - Distributable Earnings (Loss) for the nine months ended September 30, 2025, was $(91,916,000), compared to $(45,752,000) for the same period in 2024[165]. - The company’s GAAP net loss attributable to common stockholders was $(0.6) million for Q3 2025, an improvement from $(17.0) million in Q2 2025[244]. Book Value and Capitalization - The book value per share of common stock as of September 30, 2025, was $7.94, which includes $(2.82) per share of total CECL reserves[156]. - The book value per share of common stock as of September 30, 2025, was $7.94, down from $8.47 as of December 31, 2024[166]. - The company's tangible net worth was reported at $0.7 billion, exceeding the required minimum of $0.6 billion[214]. - As of September 30, 2025, the company's capitalization included $1.2 billion of loan-level financing[250]. Loan Portfolio and Credit Losses - The total allowance for credit losses was $133.6 million, approximately 7.4% of total loan commitments of $1.8 billion as of September 30, 2025[158]. - The company ended the quarter with a portfolio of 44 loan investments with an aggregate unpaid principal balance of $1.7 billion and total commitments of $1.8 billion[158]. - The weighted average risk rating of the loan portfolio improved to 2.8 as of September 30, 2025, from 3.1 at December 31, 2024[169]. - The company recorded a benefit from credit losses of $1.6 million in Q3 2025, compared to a provision for credit losses of $(11.0) million in Q2 2025[242]. - The provision for credit losses for the nine months ended September 30, 2025, was $(13.1) million, significantly lower than $(164.2) million in the same period of 2024[248]. Interest Income and Expenses - For the three months ended September 30, 2025, the total interest income was $33.72 million, with a net interest income of $10.296 million[221]. - The average net asset yield for loans held-for-investment was 7.5% for the three months ended September 30, 2025[221]. - Total interest income for the nine months ended September 30, 2025, decreased to $102.7 million, down by $44.2 million from $146.8 million in the same period of 2024[246]. - Total interest expense for the nine months ended September 30, 2025, decreased to $76.3 million, down by $42.2 million from $118.5 million in the same period of 2024[247]. Operating Expenses - Total operating expenses for Q3 2025 were $12.5 million, down from $14.5 million in Q2 2025[243]. - Total operating expenses for the nine months ended September 30, 2025, increased to $41,250,000 from $37,571,000 in 2024, representing an increase of approximately 4.5%[249]. - Compensation and benefits expenses decreased to $4.1 million in Q3 2025 from $5.7 million in Q2 2025[243]. - Compensation and benefits expenses decreased to $15,556,000 in 2025 from $16,083,000 in 2024, a reduction of about 3.3%[249]. Liquidity and Financing - The company carried unrestricted cash of $62.7 million as of September 30, 2025[155]. - The company has $75.6 million in unfunded loan commitments as part of its liquidity needs[258]. - As of September 30, 2025, the company had immediate liquidity sources totaling $62,690,000[254]. - The company is actively exploring additional funding facilities to diversify its financing sources amid market volatility and elevated interest rates[226]. Market Conditions and Risks - The Federal Reserve's interest rate hikes in 2022 and 2023 have influenced the company's performance, with rates remaining elevated despite reductions in late 2024 and 2025[263]. - The company’s loan originations are affected by market demand, with significant disruptions noted due to inflation concerns and geopolitical uncertainty[225]. - The company is subject to counterparty risk and is focused on diversifying lending partners to mitigate this risk[259]. Dividend Practices - The company intends to distribute substantially all taxable income to stockholders to comply with REIT provisions, with distributions dependent on actual results and liquidity[261]. - The board of directors will evaluate dividend practices based on market conditions and distribution requirements to maintain REIT status[258].

Financial Performance - Recognized GAAP net loss attributable to common stockholders of $(0.6) million, or $(0.01) per basic weighted average common share, including a benefit from credit losses of $1.6 million, or $0.03 per basic weighted average common share[5] - Distributable Earnings (Loss) of $(18.9) million or $(0.40) per basic weighted average common share, with Distributable Earnings (Loss) Before Realized Gains and Losses of $0.9 million, or $0.02 per basic weighted average common share[5] - The company reported a net loss attributable to common stockholders of $565,000 in Q3 2025, compared to a net loss of $34.62 million in Q3 2024[15] - Distributable Earnings (Loss) for Q3 2025 was $(18.93) million, reflecting a significant decline from the previous period[16] Loan Portfolio and Credit Losses - Total CECL reserve of $133.6 million, representing 7.4% of total loan portfolio commitments[5] - Carried a 97% floating rate loan portfolio with total loan commitments of $1.8 billion, comprised of over 99% senior loans, and a realized loan portfolio yield of 7.5%[5] - Net loan portfolio activity showed a decrease of $(109.7) million in unpaid principal balance, including $(72.4) million in loan repayments and one loan resolution of $(50.0) million[5] - The provision for credit losses was $(1.64) million in Q3 2025, compared to a benefit of $(27.91) million in Q3 2024[15] Cash and Leverage - Ended the quarter with $62.7 million in unrestricted cash and a Total Leverage Ratio of 1.9x[5] - As of November 3, 2025, carried approximately $80.1 million in unrestricted cash[5] - Extended the maturity of the secured credit facility to December 2026, reducing the financing spread by 75 basis points and decreasing borrowings by $7.5 million[5] Income and Expenses - Total interest income for Q3 2025 was $33.72 million, a decrease of 24% from $44.30 million in Q3 2024[15] - Net interest income increased to $10.30 million in Q3 2025, up from $7.66 million in Q3 2024, representing a 34% increase[15] - Total expenses decreased to $12.46 million in Q3 2025, down from $14.57 million in Q3 2024, a reduction of 14%[15] Dividends and Shareholder Returns - Declared common stock dividend of $0.05 per common share and a cash dividend of $0.4375 per share of its Series A preferred stock[5] - The company declared dividends of $0.05 per common share for Q3 2025, consistent with the previous year[15] - The company aims to maintain its status as a REIT by distributing at least 90% of its taxable income to stockholders[16] Shareholder Metrics - Book value per common share was $7.94, inclusive of $(2.82) per common share of total CECL reserve[5] - Weighted average shares outstanding decreased to 47,394,519 in Q3 2025 from 50,526,492 in Q3 2024[15] Real Estate Operations - The company recorded revenue from real estate owned operations of $3.62 million in Q3 2025, slightly down from $3.79 million in Q3 2024[15]

Core Insights - Granite Point Mortgage Trust (NYSE: GPMT) and Sachem Capital (NYSE: SACH) are currently out of favor with investors, with public preferreds trading at discounts to their $25 per share liquidation value [1] Group 1: Market Dynamics - The equity market serves as a powerful mechanism where daily price fluctuations can lead to significant wealth creation or destruction over the long term [1] - Pacifica Yield focuses on long-term wealth creation by targeting undervalued yet high-growth companies, high-dividend stocks, REITs, and green energy firms [1]