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Two Harbors Acquisition by UWM Gives Investors Major Windfall

Jack KelloggAvatar
Written by Jack Kellogg Reviewed by Tim Sykes Fact-checked by Ellis Hobbs
Updated 1/11/2026, 8:18 am ET 1/11/2026, 8:18 am ET | 5 min 5 min read
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Two Harbors Investment’s stocks have been trading up by 11.61 percent driven by investor confidence.

Finance industry expert:

Analyst sentiment – neutral

Market Position & Fundamentals: Two Harbors Investment Corp (TWO) is currently experiencing significant challenges within its market position, evidenced by key financial metrics. The company has a pre-tax profit margin of 35.5%, but an alarming total profit margin of -47.91%. This indicates that despite generating revenue of $593.5 million (with $5.7 revenue per share), it suffers from substantial losses. TWO’s debt strategies appear conservative, with a total debt to equity ratio of 0.33 and a leverage ratio of 9.3, suggesting cautious capital structure management. However, the negative free cash flow of -$247.9 million and return on equity of -17.62% reflect ongoing operational struggles and inefficiencies.

Technical Analysis & Trading Strategy: Examining the recent weekly price data, Two Harbors shows a bullish trend with a notable price increase, escalating from an opening of $10.39 to a closing of $12.21 within a week, reflecting strong upward movement after the merger announcement news. The rich trading volume further asserts this market interest and increased demand. A key trading strategy would focus on riding this upward trend as the momentum continues to gather strength, targeting a resistance level at around $12.30, while looking to cut losses if prices dip below $11.40. This price level has served as a support in recent patterns, indicating a strong support zone.

Catalysts & Outlook: Recent developments indicate a strategic shift for TWO with its announced acquisition by UWM Holdings Corporation in an all-stock deal valued at $1.3 billion. This transaction, which offers a 21% premium, considerably enhances TWO’s market strength and provides shareholders an elevated value proposition. The deal aligns with a broader industry trend towards consolidation, enabling greater scale in mortgage servicing. The announcement spurred a 12% stock price surge, reflecting investor confidence. With the mortgage REIT segment exhibiting variance, TWO distinguishes itself with this merger, representing growth potential and long-term value, pending successful integration. Our assessment leans neutral, considering the execution risks inherent in such consolidations balanced by the immediate positive market reaction.

Candlestick Chart

Weekly Update Jan 05 – Jan 09, 2026: On Sunday, January 11, 2026 Two Harbors Investment Corp stock [NYSE: TWO] is trending up by 11.61%! Discover the key drivers behind this movement as well as our expert analysis in the detailed breakdown below.

Quick Financial Overview

Two Harbors’ recent earnings report and key financial ratios paint an intriguing picture of its underlying potential and market position. Despite the current economic pressures, the company’s projections remain firm. Key profitability metrics, such as its pre-tax profit margin standing at 35.5%, indicate robust operational efficiency. However, the -51.46% profit margin showcases the challenges it faces in translating revenue into net income effectively, hinting at areas needing refinement.

In examining its income statements, Two Harbors recorded revenues of approximately $593.49M, with shares generating an enticing yield of 11.12%, thanks to disciplined dividend policies. A significant note is the continuity in quarterly dividends, at $0.34 per share, offering tactical reassurance to investors wary of volatility pre-merger.

Regarding market performance, TWO’s book value per share (BVPS) of 11.24 suggests a company trading reasonably with its intrinsic value. A calculated risk is its high leverage ratio at 9.3, simultaneously indicating both its prowess in scaling operations through debt and the added pressure of maintaining service obligations. Importantly, the spike in stock price post-announcement underscores the market’s confidence in the synergistic promise of merging with UWM.

This is stock news, not investment advice. Timothy Sykes News delivers real-time stock market news focused on key catalysts driving short-term price movements. Our content is tailored for active traders and investors seeking to capitalize on rapid price fluctuations, particularly in volatile sectors like penny stocks. Readers come to us for detailed coverage on earnings reports, mergers, FDA approvals, new contracts, and unusual trading volumes that can trigger significant short-term price action. Some users utilize our news to explain sudden stock movements, while others rely on it for diligent research into potential investment opportunities.

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Jack Kellogg

He teaches webinars on Tim Sykes’ Trading Challenge He became Tim’s youngest millionaire student in 2020. Now he’s second on the Trading Challenge leaderboard with $12.9 million in career earnings. He’s a master of the 7-Step Pennystocking Framework. Jack is one of a rare breed of traders to profitably trade the entire penny stock framework.
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* Results are not typical and will vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here

The available research on day trading suggests that most active traders lose money. Fees and overtrading are major contributors to these losses.

A 2000 study called “Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors” evaluated 66,465 U.S. households that held stocks from 1991 to 1996. The households that traded most averaged an 11.4% annual return during a period where the overall market gained 17.9%. These lower returns were attributed to overconfidence.

A 2014 paper (revised 2019) titled “Learning Fast or Slow?” analyzed the complete transaction history of the Taiwan Stock Exchange between 1992 and 2006. It looked at the ongoing performance of day traders in this sample, and found that 97% of day traders can expect to lose money from trading, and more than 90% of all day trading volume can be traced to investors who predictably lose money. Additionally, it tied the behavior of gamblers and drivers who get more speeding tickets to overtrading, and cited studies showing that legalized gambling has an inverse effect on trading volume.

A 2019 research study (revised 2020) called “Day Trading for a Living?” observed 19,646 Brazilian futures contract traders who started day trading from 2013 to 2015, and recorded two years of their trading activity. The study authors found that 97% of traders with more than 300 days actively trading lost money, and only 1.1% earned more than the Brazilian minimum wage ($16 USD per day). They hypothesized that the greater returns shown in previous studies did not differentiate between frequent day traders and those who traded rarely, and that more frequent trading activity decreases the chance of profitability.

These studies show the wide variance of the available data on day trading profitability. One thing that seems clear from the research is that most day traders lose money .

Millionaire Media 66 W Flagler St. Ste. 900 Miami, FL 33130 United States (888) 878-3621 This is for information purposes only as Millionaire Media LLC nor Timothy Sykes is registered as a securities broker-dealer or an investment adviser. No information herein is intended as securities brokerage, investment, tax, accounting or legal advice, as an offer or solicitation of an offer to sell or buy, or as an endorsement, recommendation or sponsorship of any company, security or fund. Millionaire Media LLC and Timothy Sykes cannot and does not assess, verify or guarantee the adequacy, accuracy or completeness of any information, the suitability or profitability of any particular investment, or the potential value of any investment or informational source. The reader bears responsibility for his/her own investment research and decisions, should seek the advice of a qualified securities professional before making any investment, and investigate and fully understand any and all risks before investing. Millionaire Media LLC and Timothy Sykes in no way warrants the solvency, financial condition, or investment advisability of any of the securities mentioned in communications or websites. In addition, Millionaire Media LLC and Timothy Sykes accepts no liability whatsoever for any direct or consequential loss arising from any use of this information. This information is not intended to be used as the sole basis of any investment decision, nor should it be construed as advice designed to meet the investment needs of any particular investor. Past performance is not necessarily indicative of future returns.

Citations for Disclaimer

Barber, Brad M. and Odean, Terrance, Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors. Available at SSRN: “Day Trading for a Living?”

Barber, Brad M. and Lee, Yi-Tsung and Liu, Yu-Jane and Odean, Terrance and Zhang, Ke, Learning Fast or Slow? (May 28, 2019). Forthcoming: Review of Asset Pricing Studies, Available at SSRN: “https://ssrn.com/abstract=2535636”

Chague, Fernando and De-Losso, Rodrigo and Giovannetti, Bruno, Day Trading for a Living? (June 11, 2020). Available at SSRN: “https://ssrn.com/abstract=3423101”