Dynex Capital (NYSE:DX) reported significant growth in market capitalization and investment portfolio size, with leverage increased to 8.3 in the second quarter. The company raised $560 million of new capital and focused on common equity issuance. Net interest income trended upward, while new investments in agency MBS generated attractive ROEs. The portfolio emphasized agency MBS with selective additions of agency CMBS. The company also made operational enhancements by bringing functions in-house. Swap spreads were down to 47 basis points below Treasuries, contributing to returns. Overall, Dynex Capital demonstrated strong growth and strategic positioning in a volatile market environment.

During the conference call, executives discussed the company’s strategic vision and proactive approach to market volatility. They highlighted the importance of dividends in shareholder value creation and emphasized the role of talent acquisition in enhancing the company’s operational capabilities. The mortgage investment environment was described as offering historic returns relative to hedges, with opportunities in agency MBS and agency CMBS markets. The company’s focus on disciplined risk management, liquidity maintenance, and strategic capital deployment underscored its commitment to long-term total return generation in a dynamic market landscape.

Read more at Nasdaq: Dynex Capital (DX) Q2 2025 Earnings Call Transcript