The end of the earnings season is always a good time to take a step back and see who shined (and who didn’t). Let’s take a look at how thrifts & mortgage finance stocks fared in Q2, starting with Ellington Financial (NYSE:EFC).
Thrifts & Mortgage Finance institutions operate by accepting deposits and extending loans primarily for residential mortgages, earning revenue through interest rate spreads (difference between lending rates and borrowing costs) and origination fees. The industry benefits from demographic tailwinds as millennials enter prime homebuying age, technological advancements streamlining the loan approval process, and potential interest rate stabilization improving affordability. However, significant headwinds include net interest margin compression during rate volatility, increased competition from fintech disruptors offering digital-first experiences, mounting regulatory compliance costs, and potential housing market corrections that could impact loan portfolios and default rates.
The 12 thrifts & mortgage finance stocks we track reported a slower Q2. As a group, revenues missed analysts’ consensus estimates by 3.4% while next quarter’s revenue guidance was 10.1% below.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 17% since the latest earnings results.
Ellington Financial (NYSE:EFC)
Operating under the guidance of Ellington Management Group, a respected name in structured credit markets, Ellington Financial (NYSE:EFC) acquires and manages a diverse portfolio of mortgage-related, consumer-related, and other financial assets to generate returns for investors.
Ellington Financial reported revenues of $123.1 million, up 33.1% year on year. This print exceeded analysts’ expectations by 9.4%. Overall, it was a stunning quarter for the company with a beat of analysts’ EPS estimates and a solid beat of analysts’ net interest income estimates.
Ellington Financial pulled off the biggest analyst estimate beat among its peers. Investor expectations, however, were likely higher than Wall Street’s published projections, leaving some wishing for even better results (analysts’ consensus estimates are those published by big banks and advisory firms, not the investors who make buy and sell decisions). The stock is down 11.3% since reporting and currently trades at $11.66.
Is now the time to buy Ellington Financial? Access our full analysis of the earnings results here, it’s free.
Best Q2: Arbor Realty Trust (NYSE:ABR)
With roots dating back to 2003 and a focus on the stability of multifamily housing, Arbor Realty Trust (NYSE:ABR) is a specialized lender that provides financing solutions for multifamily and commercial real estate while also originating and servicing government-backed mortgage loans.
Arbor Realty Trust reported revenues of $115.9 million, down 11.1% year on year, outperforming analysts’ expectations by 7.1%. The business had a stunning quarter with a beat of analysts’ EPS estimates and a solid beat of analysts’ net interest income estimates.
Although it had a fine quarter compared to its peers, the market seems unhappy with the results as the stock is down 24.9% since reporting. It currently trades at $3.60.
Is now the time to buy Arbor Realty Trust? Access our full analysis of the earnings results here, it’s free.
Rocket Companies (NYSE:RKT)
Born in Detroit during the 1980s and evolving into a tech-driven financial powerhouse, Rocket Companies (NYSE:RKT) is a fintech company that provides digital mortgage lending, real estate services, and personal finance solutions through its technology platform.
Rocket Companies reported revenues of $2.76 billion, up 92.9% year on year, falling short of analysts’ expectations by 2.7%. It was a disappointing quarter as it posted EPS in line with analysts’ estimates.
As expected, the stock is down 11.1% since the results and currently trades at $11.75.
Read our full analysis of Rocket Companies’s results here.
Franklin BSP Realty Trust (NYSE:FBRT)
Operating as a specialized real estate investment trust (REIT) with roots dating back to 2012, Franklin BSP Realty Trust (NYSE:FBRT) originates and manages a diversified portfolio of commercial real estate debt investments secured by properties in the United States and abroad.
Franklin BSP Realty Trust reported revenues of $58.06 million, up 14.2% year on year. This number came in 28.3% below analysts’ expectations. Overall, it was a mixed quarter for the company.
Franklin BSP Realty Trust had the weakest performance against analyst estimates in the group. The stock is down 16.7% since reporting and currently trades at $6.28.
Read our full, actionable report on Franklin BSP Realty Trust here, it’s free.
WaFd Bank (NASDAQ:WAFD)
Founded in 1917 and rebranded from Washington Federal in 2023, WaFd (NASDAQ:WAFD) is a bank holding company that provides lending, deposit services, and insurance through its Washington Federal Bank subsidiary across eight western states.
WaFd Bank reported revenues of $202 million, up 8.4% year on year. This result surpassed analysts’ expectations by 1.2%. Aside from that, it was a mixed quarter as it also recorded a narrow beat of analysts’ net interest income estimates but EPS in line with analysts’ estimates.
The stock is down 21.7% since reporting and currently trades at $30.80.
Read our full, actionable report on WaFd Bank here, it’s free.
Market Update
Over the past year, investors have been forced to repeatedly answer the same question: what is the market’s biggest risk? The answer has changed several times, and each shift has reshaped market leadership.
Late in 2025 and early 2026, artificial intelligence became the market’s primary uncertainty. Investors questioned whether AI would erode software pricing power and weaken competitive moats as AI made it easier to replicate once-differentiated products.
By the spring, technology took a back seat to geopolitics. The U.S. conflict with Iran briefly became the market’s dominant narrative, raising concerns about oil prices, inflation, and global growth. But as energy markets remained orderly and fears of a prolonged supply disruption faded, investors quickly turned their focus back to fundamentals.
Want to invest in winners with rock-solid fundamentals? Check out our Top 5 Quality Compounder Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.