TPG Mortgage Investment Trust, Inc. (MITN) stock intrinsic value fair value estimate & owner earnings analysis

TPG Mortgage Investment Trust (formerly AG Mortgage Investment Trust) is an externally managed mortgage REIT. It borrows heavily against a portfolio of about $8.25 billion of residential mortgage loans and mortgage securities, plus a small legacy commercial book acquired in the December 2023 purchase of Western Asset Mortgage Capital, and keeps the spread between what the assets earn and what the borrowing costs. Its manager charges a base fee on equity regardless of results. This valuation is of the common shares; the company also has about $228 million of preferred stock (Series A, B and C) whose dividends of $21.2 million in 2025 come ahead of common holders, and two 9.5% senior note issues due 2029 listed under the symbols MITN and MITP. How we measure earnings. We start from operating cash flow, subtract stock compensation and working-capital swings, and, because preferred dividends are paid outside operating cash flow, subtract them too so the figure is what belongs to common holders. There are no meaningful capital expenditures. We do not add cash or subtract debt; leverage is handled in the bear case. On this basis, earnings per common share were $0.79 (2021), $0.12 (2022), $0.34 (2023), $1.06 (2024) and $1.24 (2025). Earlier years look far stronger ($4 to $5 per share, adjusted for the 2021 reverse split) but describe a different business that was nearly wiped out in the March 2020 crisis, when the company received margin calls, default notices and deficiency letters from lenders well beyond historical norms and had to work them out during 2020. 2020 itself was negative at about -$0.98 per share. We anchor on 2024 and 2025 (about $1.15 per share) because the December 2023 acquisition roughly changed the share count and portfolio, and two consecutive years, plus a first half of 2026 in which operating cash flow of $44.6 million was well above the $23.5 million of the first half of 2025, corroborate the higher level. We did not use the higher 2026 pace to lift the level. One accounting point: $23 million of 2025 operating cash flow is a non-cash add-back for premium amortization on loans bought above face value. That premium was paid out in cash when the loans were purchased, so it is a real cost that leaves the earnings figure looking richer than the economics; we carry this by fading earnings in the later years rather than lowering the starting level. Growth check. Earnings per share grew about 16% in 2025 (from $1.06 to $1.24); the base case assumes no growth in year 1, which is below that rate. No growth is credited in any case: growing the portfolio requires new capital and new borrowing, which have not been secured. Base case, $10.8 per share. Earnings hold near $1.15 for ten years, then fade linearly to zero over the following ten, because a portfolio that repays and prepays constantly only earns if it is continually reinvested at attractive spreads, and nothing contracted guarantees that beyond the current book. Discounted at 6%, this is close to the reported book value of $10.48 per share. Bear case, $2.2 per share. Financing conditions tighten as in 2020. The company reported a leverage ratio of 14.4x on a GAAP basis (1.6x on the company's economic measure), with unrealized losses of $280 million on the portfolio against $111 million of gains at year-end 2025. We assume a loss year of about -$0.50 per share, a flat year, then a return to only $0.35 per share (the 2022 to 2023 range) for the remaining years of the decade, fading afterward. Bull case, $15.0 per share. Earnings run at $1.60 per share for ten years and fade over the next ten. The first half of 2026 operating cash flow is running well above 2025 levels, and the company completed multiple securitizations in 2025 that lock in longer-term funding on its loan purchases. What would make this wrong: a repeat of the 2020 funding squeeze, credit losses on loans (including the legacy commercial loans, several of which are on non-accrual status), or the manager fee and preferred dividends absorbing more of the spread than assumed. We could not fully reconcile some earlier-year preferred dividend amounts (2016 to 2019), which we derived from reported earnings per share.