Invesco Mortgage Capital Inc. (IVR): Business Model Canvas [Dec-2025 Updated]

You're looking to decode the engine behind Invesco Mortgage Capital Inc. (IVR), and honestly, it's a classic, pure-play mortgage REIT (mREIT) model, just run by the pros at Invesco. Their game is simple, yet requires sharp execution: borrow cheap short-term money, primarily via repo financing, to buy long-term, government-backed Agency securities, aiming for that sweet dividend yield you're after. With an investment portfolio clocking in around $5.7 billion as of late 2025, and generating $72.30 million in total revenue for the last twelve months ending Q3 2025, the real trick is managing the interest rate risk through savvy hedging. Dive into the full Business Model Canvas below to see exactly how they structure their key partnerships and activities to keep that quarterly common stock dividend of $0.34 per share flowing.

Invesco Mortgage Capital Inc. (IVR) - Canvas Business Model: Key Partnerships

You're looking at the structure that keeps Invesco Mortgage Capital Inc. running day-to-day, which is heavily reliant on external relationships. For a mortgage REIT like Invesco Mortgage Capital Inc., these partnerships aren't just nice-to-haves; they are the plumbing for its entire investment strategy.

Invesco Advisers, Inc. for external management and advisory services

Invesco Mortgage Capital Inc. is externally managed and advised by Invesco Advisers, Inc., which is a subsidiary of Invesco Ltd.. This relationship means the day-to-day investment decisions, risk management framework, and transaction execution are handled by the experienced team at Invesco Advisers, Inc.. The firm's team brings over 25 years of experience in the Agency MBS market, using advanced prepayment and valuation modeling capabilities to assess relative value across the sector.

Major financial institutions providing repurchase agreement (repo) financing

Securing short-term funding through repurchase agreements (repos) is critical for a leveraged investment vehicle. Invesco Mortgage Capital Inc. uses these agreements to finance its Agency RMBS and Agency CMBS investments. As of the third quarter of 2025, the company financed its portfolio using repos across 20 counterparties. This broad base helps manage counterparty risk, which is always a key consideration in secured financing markets.

Here's a look at the leverage and funding profile as of late 2025:

U.S. Government Sponsored Entities (GSEs) like Fannie Mae and Freddie Mac

The core assets of Invesco Mortgage Capital Inc. are directly tied to the GSEs, as the company primarily invests in Agency MBS, which are guaranteed by Fannie Mae and Freddie Mac. These securities form the backbone of the investment portfolio, offering stability of principal and reliable investment income. The focus on Agency MBS helps insulate the portfolio from some of the credit risk seen in non-guaranteed assets, though interest rate and spread risk remain central challenges.

The investment portfolio composition as of September 30, 2025, shows this reliance:

• Agency RMBS (Residential Mortgage-Backed Securities): $4.8 billion
• Agency CMBS (Commercial Mortgage-Backed Securities): $0.9 billion
• Total Investment Portfolio: $5.7 billion

For the Agency CMBS segment, the relative value assessment involves looking at spreads to Treasuries, with data points like the Fannie DUS 10/9.5 spread being tracked at 80.7% and Freddie Multi PCs at 19.3% as of the end of Q3 2025.

Investment banks for executing complex hedging and trading strategies

To manage the interest rate risk inherent in holding long-duration MBS, Invesco Mortgage Capital Inc. actively partners with institutions to execute hedging strategies, primarily using derivatives. The firm hedged 85% of its borrowing costs as of the third quarter of 2025 using interest rate swaps and U.S. Treasury futures. This is a slight reduction from the 94% hedged in Q2 2025.

Specific details on the hedge notional from Q2 2025 illustrate the scale of these derivative partnerships:

• Interest Rate Swap Notional Amount: $3.5 billion
• Weighted Average Pay Rate on Swaps: 1.19%
• U.S. Treasury Futures Notional: $830 million

These hedging activities require ongoing execution and management, meaning active relationships with major broker-dealers and investment banks are essential for managing the portfolio's duration and volatility exposure. Finance: review Q4 2025 hedge execution costs against Q3 2025 swap spread performance by next Tuesday.

Invesco Mortgage Capital Inc. (IVR) - Canvas Business Model: Key Activities

You're looking at the engine room of Invesco Mortgage Capital Inc. (IVR), the core things they must do well to keep the machine running and paying out. For a mortgage REIT like IVR, this is all about asset selection, financing, and risk control, especially as of late 2025.

Active management of the $5.7 billion investment portfolio

The primary activity is managing the assets, which were valued at $5.7 billion as of September 30, 2025. This isn't a static pile of paper; it's constantly being adjusted based on market signals. The focus has clearly shifted to high-quality, government-backed assets, which is a key strategic move you'd expect from a seasoned manager in this environment.

Here's a quick look at what that $5.7 billion portfolio looked like at the end of the third quarter of 2025:

They were actively buying, too. The Agency RMBS portfolio specifically grew by 13.2% quarter-over-quarter, with net purchases totaling $647 million during the third quarter of 2025 to invest proceeds from their ATM program and reinvest paydowns.

Executing interest rate hedges using swaps and futures to manage risk

Managing interest rate risk is non-negotiable for a leveraged mortgage REIT. You need to lock in your funding costs relative to your asset yields. Invesco Mortgage Capital Inc. hedged 85% of its borrowing costs as of the third quarter end. This is a substantial hedge ratio, showing a commitment to protecting net interest margin.

The total notional amount of their hedges stood at $4.4 billion, up from $4.3 billion the prior quarter. The structure of this protection is detailed below:

• Total Interest Rate Swap Notional Amount: $3.38 billion
• Treasury Futures Notional: $1 billion
• Weighted Average Pay Rate on Swaps: 1.08%

The swap book was strategically spread across maturities, with $1,555 million in the less than 3-year bucket paying an average of 0.31%.

Macroeconomic and capital markets analysis for asset allocation decisions

This activity involves constantly interpreting what the Fed and the broader economy are doing. In mid-September 2025, the Federal Reserve made a move, reducing the Federal Funds target rate by 25 basis points. Management is looking ahead, anticipating three more rate cuts by the Federal Reserve before the end of 2026. This forward-looking analysis directly informs whether they lean more into RMBS or CMBS, or adjust the duration of their hedges.

Securing and managing short-term funding via repurchase agreements

You can't hold billions in MBS without short-term financing, and for IVR, that means repurchase agreements (repos). Borrowings via repurchase agreements increased from $4.6 billion to $5.2 billion in the third quarter of 2025, which tracks the growth in their assets. They manage this funding across 20 counterparties, which helps diversify counterparty risk. The overall leverage metric, the debt-to-equity ratio, ticked up slightly to 6.7x from 6.5x at the end of the second quarter of 2025.

The firm also maintained a sizable liquidity buffer, holding $423 million in unrestricted cash and unencumbered investments at quarter end.

Distributing quarterly dividends to common and preferred shareholders

Returning capital to shareholders is a core function. For common stock in the third quarter of 2025, the declared cash dividend was $0.34 per share, paid on October 24, 2025. This translates to an annual dividend rate of $1.36 per share, which represented a yield of approximately 16.61% based on recent pricing data. The payout ratio against earnings available for distribution was 58%. Don't forget the preferred shareholders; the Series C Preferred Stock dividend declared in May 2025 was $0.46875 per share.

Finance: draft 13-week cash view by Friday.

Invesco Mortgage Capital Inc. (IVR) - Canvas Business Model: Key Resources

The Key Resources for Invesco Mortgage Capital Inc. center on its investment assets, capital structure management, and the human capital driving its strategy.

The core asset base, as of the end of the third quarter of 2025, is detailed by asset class:

Liquidity is maintained through a significant holding of readily available assets. The balance of unrestricted cash and unencumbered investments totaled $423 million at quarter end.

The firm's capital structure is managed to support its investment strategy, reflected in its leverage:

• Debt-to-equity ratio: 6.7x as of September 30, 2025.

The operational capability relies on specialized personnel and market access:

• Management team's deep expertise in Agency MBS and risk modeling.
• Access to diverse funding markets, evidenced by the 6.7x debt-to-equity ratio, which supports the scale of the $5.7 billion investment portfolio.

The firm also raised $36.1 million, net of issuance costs, through its at-the-market common stock program during the third quarter of 2025.

Invesco Mortgage Capital Inc. (IVR) - Canvas Business Model: Value Propositions

You're looking at the core promises Invesco Mortgage Capital Inc. makes to its investors, which is what this Value Propositions block of the Business Model Canvas is all about. For a mortgage REIT like Invesco Mortgage Capital Inc., it boils down to income, safety, and expertise.

High, regular dividend income for shareholders, a key mREIT feature.

The primary draw is the regular cash payout. Invesco Mortgage Capital Inc. declared a cash dividend of $0.34 per share of common stock for the third quarter of 2025, which was paid on October 24, 2025. This translates to an expected annual dividend of $1.36 per share based on the latest declared rate. Based on recent trading prices, this offered a forward dividend yield around 16.52%. The company aims for this to be competitive and sustainable, having reduced the dividend earlier in 2025 to preserve book value. For Q3 2025, Earnings Available for Distribution (EAD) per common share was $0.58, covering the $0.34 dividend with a payout ratio of 58% of earnings.

Here's a look at the recent dividend history:

Principal stability through investment primarily in GSE-guaranteed Agency securities.

Invesco Mortgage Capital Inc. structures its portfolio to prioritize stability by focusing on assets guaranteed by U.S. Government Sponsored Entities (GSEs), specifically Fannie Mae and Freddie Mac, which are known as Agency MBS. This focus is intended to largely isolate the portfolio from broader market turmoil. As of the end of the third quarter of 2025, the investment portfolio totaled $5.7 billion.

The composition of that portfolio shows the heavy reliance on Agency assets:

• Agency Residential Mortgage-Backed Securities (RMBS): $4.8 billion
• Agency Commercial Mortgage-Backed Securities (CMBS): $0.9 billion

This means that Agency securities comprised approximately 84.2% of the total investment portfolio at that time ($\frac{4.8}{5.7}$). The company also maintains a buffer of liquidity, reporting unrestricted cash and unencumbered investments totaling $423 million as of October 24, 2025.

Professional, dynamic portfolio management by a leading global investment firm.

The day-to-day operation and strategy execution are handled by Invesco Advisers, Inc., which is a subsidiary of Invesco Ltd. (NYSE: IVZ), recognized as a leading independent global investment management firm. This relationship provides access to deep expertise. The team managing the Agency MBS market has over 25 years of experience and utilizes leading-edge mortgage prepayment and valuation modelling capabilities. The investment process is disciplined, involving formal Investment Committee decision-making to establish asset allocation and risk boundaries.

Liquidity and transparency from investing in highly liquid Agency MBS.

Agency MBS are inherently highly liquid assets in the fixed-income market, which supports the company's ability to manage its portfolio actively. Transparency is provided through regular reporting of key metrics, such as the book value per common share, which was reported at $8.41 as of September 30, 2025. The management process explicitly includes the active trading of portfolio positions and the management of liquidity.

The management team's actions resulted in a positive economic return of 8.7% for the third quarter of 2025, which combines the $0.34 dividend and the $0.36 increase in book value per common share during the quarter.

Finance: draft 13-week cash view by Friday.

Invesco Mortgage Capital Inc. (IVR) - Canvas Business Model: Customer Relationships

The relationship with the investment community for Invesco Mortgage Capital Inc. is fundamentally transactional, mediated by public markets and direct financial reporting mechanisms.

The primary point of transaction is the New York Stock Exchange, where the common stock trades under the ticker IVR. You can see the real-time market activity reflected in recent closing prices and trading ranges.

This direct market access defines the core exchange, but Invesco Mortgage Capital Inc. supplements this with structured, regular communication to maintain investor engagement.

Regular communication happens through scheduled quarterly events. For instance, the third quarter 2025 results were released on Thursday, October 30, 2025, followed by a conference call and audio webcast on Friday, October 31, 2025, at 9:00 a.m. ET.

These calls feature key management personnel, ensuring direct access to strategic commentary from the leadership team.

• CEO John Anzalone
• CIO Brian Norris
• President Kevin Collins
• COO David Lyle
• CFO Mark Gregson

The company also provided a presentation covering the topics for the Q3 2025 call, which was available on the website prior to the event.

Automated dividend payments are a key part of the relationship for both common and preferred shareholders. For the third quarter of 2025, the cash dividend declared for common stock was $0.34 per share, paid on October 24, 2025.

The annualized common dividend is currently stated as $1.36 per share, representing a yield of $16.61\%$ based on a prior price, while the current yield is cited at $16.52\%$. You can expect the next common dividend to be $0.34 per share, with an ex-date of December 30, 2025, and a payment date of January 23, 2026.

For defintely timely financial disclosures and ongoing communication, the Investor Relations website at www.invescomortgagecapital.com is the central hub. You can reach the Investor Relations contact directly for specific inquiries.

• Contact Person: Greg Seals, CFA
• Phone Number: 404-439-3323

Finance: draft 13-week cash view by Friday.

Invesco Mortgage Capital Inc. (IVR) - Canvas Business Model: Channels

You're looking at how Invesco Mortgage Capital Inc. gets its stock into the hands of investors and how it executes its core asset and liability management in the market. For a mortgage REIT like Invesco Mortgage Capital Inc., the channels aren't about selling a physical product; they are about market access, transparency, and transactional capability.

New York Stock Exchange (NYSE) for common and preferred stock trading

The primary public channel for Invesco Mortgage Capital Inc. common stock is the New York Stock Exchange (NYSE), trading under the ticker IVR. This is where the market sets the price for your equity stake. As of November 20, 2025, the trading volume for IVR was reported at 974,247 shares. The stock traded in a daily range between $7.560 and $7.705 on that date. To give you a sense of the scale, the total number of Shares Outstanding was approximately 289,680,760. By December 5, 2025, the closing price had moved up to $8.40. The market access here is critical for liquidity, which is something investors watch closely, especially given the reported 52-week range of $5.855 to $9.060.

Investor Relations website for financial reports and webcasts

The Investor Relations (IR) website, found at www.invescomortgagecapital.com, serves as the direct, official channel for information dissemination. This is where you find the detailed documentation that underpins investment decisions. For instance, the Third Quarter 2025 Financial Results were announced on October 30, 2025. These reports detail key figures, such as the Q3 2025 Book value per common share of $8.41 and an Economic return of 8.7% for the quarter. The IR site hosts the press releases and the presentation materials for earnings calls, like the one for Q2 2025 held on July 25, 2025. This channel ensures a level playing field for all stakeholders seeking official data.

• Q3 2025 Earnings Available for Distribution per common share: $0.58.
• Q3 2025 Common stock dividend: $0.34 per common share.
• Q3 2025 Debt-to-equity ratio: 6.7x.
• Capital raised via at-the-market program in Q3 2025: $36.1 million.

Brokerage platforms and financial advisors for retail investor access

Retail investors access Invesco Mortgage Capital Inc. shares through standard brokerage platforms, which connect them to the NYSE market. The accessibility is broad, though the ownership structure shows a significant portion of the stock is held by institutions. As of late 2025, Institutional Ownership stood at 47.24%, while the Short Percent was 10.94%. Financial advisors use this public trading data and the IR materials to build portfolios for their clients, often focusing on the high yield potential, evidenced by a reported Forward Dividend Yield of 17.89%.

Investment banks and dealers for asset and liability transactions

This channel is about the operational side of Invesco Mortgage Capital Inc.'s business-managing its investment portfolio and securing financing. Investment banks and dealers facilitate the buying and selling of the mortgage-backed securities that form the core assets, and they are key counterparties in derivative transactions used for hedging. At the end of Q3 2025, the $5.7 billion investment portfolio was primarily composed of $4.8 billion in Agency RMBS and $0.9 billion in Agency CMBS. Liability management is also visible here; for example, the company had Repurchase agreements liabilities of over $5.35 billion (likely in millions) as of Q1 2025.

Here's a snapshot of the balance sheet and portfolio structure relevant to these market counterparties as of late 2025 data points:

These transactions with dealers and banks directly impact the leverage profile; the debt-to-equity ratio was 6.7x at the close of Q3 2025. Also, in Q3 2025, the company actively raised capital through its common stock program, netting $36.1 million.

Invesco Mortgage Capital Inc. (IVR) - Canvas Business Model: Customer Segments

You're looking at the core groups that provide capital to Invesco Mortgage Capital Inc. (IVR) in late 2025. These groups are attracted by different aspects of the mortgage REIT's structure, primarily its high-quality, agency-backed assets and the resulting income streams.

The primary customer base is segmented by their investment objective and the type of security they hold, which directly relates to the composition of Invesco Mortgage Capital Inc.'s $5.7 billion investment portfolio as of September 30, 2025. This portfolio is heavily weighted toward government-backed assets, which appeals to risk-averse capital providers.

Here is a breakdown of the key investor types:

• Institutional investors (e.g., BlackRock, Vanguard) seeking high yield and liquidity.
• Individual retail investors focused on quarterly dividend income.
• Preferred shareholders seeking a fixed-to-floating income stream.
• Money managers and overseas investors looking for Agency mortgage exposure.

The composition of the capital base and the asset focus clearly delineate these segments. For instance, the focus on Agency RMBS directly serves the money managers and overseas investors looking for that specific exposure, while the common stock dividend targets retail income seekers.

The ownership structure as of mid-2025 shows significant participation from large asset managers:

The common equity holders, which include many retail investors, are primarily focused on the cash distribution, as evidenced by the quarterly payout:

• Common Stock Dividend declared for Q3 2025: $0.34 per common share.
• Book Value per Common Share as of September 30, 2025: $8.41.
• Common Stock closing price on October 31, 2025: $7.56.
• Implied Annualized Dividend Yield based on October 31, 2025 price: 18.0%.
• Common Stockholders' Equity as of June 30, 2025: $534 million.

Preferred shareholders are a distinct segment, currently holding only the Series C shares. Their income stream is structured to provide security, especially given the fixed component of their yield:

• Liquidation Preference of Series C Preferred Stock as of September 30, 2025: $173.3 million.
• Preferred Equity as a percentage of Total Equity (June 30, 2025): 25%.
• Series C Fixed Coupon Rate until September 27, 2027: 7.5% annually.
• Series C Floating Rate Spread after September 27, 2027: Three-month CME Term SOFR plus a spread of 5.289%.

The asset focus of Invesco Mortgage Capital Inc. itself speaks to the demand from money managers and overseas investors, as management noted expected demand from these groups in an environment of easing monetary policy. The portfolio composition as of Q3 2025 was:

The company also maintained a sizable balance of unrestricted cash and unencumbered investments totaling $423 million at the end of Q3 2025, which supports the liquidity sought by institutional investors.

Invesco Mortgage Capital Inc. (IVR) - Canvas Business Model: Cost Structure

You're looking at the core expenses that drive Invesco Mortgage Capital Inc.'s operations, which, as an mREIT, are heavily weighted toward the cost of money. Honestly, for a company like Invesco Mortgage Capital Inc., the cost structure is dominated by financing costs.

Interest expense on repurchase agreements, which is the main way they fund their asset portfolio, is the single largest component here. For the third quarter of 2025, the Effective interest expense was reported at $26.2 million. This is the key metric you watch to see how efficiently they are managing their short-term borrowing costs against their asset yields.

The structure also includes fixed obligations to preferred shareholders. Following the redemption of the Series B shares, the annual allocation for preferred stock dividends is set at approximately $13.5 million. This is a fixed cash outflow that must be covered before common shareholders see returns.

Here's a quick look at some key financial figures from the third quarter of 2025 that frame these costs:

The External management fees paid to Invesco Advisers, Inc. are a recurring operational cost tied to the externally managed structure. While Invesco Mortgage Capital Inc. confirms the adviser relationship, the specific dollar amount for the management fee for 2025 wasn't explicitly detailed in the latest earnings summaries found.

General and administrative (G&A) expenses and operating costs cover the day-to-day running of the business, separate from the financing interest. For context on overhead absorption, the Earnings available for distribution per common share for Q3 2025 was $0.58, and the common stock dividend declared was $0.34 per share.

You should keep an eye on how the effective cost of funds moves relative to the effective interest rate margin, which was 3.28% in Q3 2025. The company is actively working to manage this cost base, as noted by the CEO's commitment to further reduce expenses.

• Preferred Dividend Coverage improved substantially in 2024.
• Series C Preferred Stock liquidation preference was $173.3 million as of September 30, 2025.
• The company repurchased Series C Preferred Stock for a total cost of $2.2 million in Q3 2025.
• The company sold common stock for net cash proceeds of $36.1 million in Q3 2025.

Finance: draft 13-week cash view by Friday.

Invesco Mortgage Capital Inc. (IVR) - Canvas Business Model: Revenue Streams

The revenue streams for Invesco Mortgage Capital Inc. are fundamentally tied to the performance of its investment portfolio, which is heavily weighted toward agency mortgage-backed securities.

Net interest income (NII) from the Agency RMBS and CMBS portfolio forms a core component of the top line. For the third quarter of 2025, the net interest income was reported at $17.6 million. The investment portfolio composition as of the end of Q3 2025 showed a significant allocation to these assets:

The overall revenue picture for Invesco Mortgage Capital Inc. shows the following for the trailing twelve-month period ending Q3 2025:

• Total revenue for the last twelve months ending Q3 2025 was $72.30 million.
• This trailing twelve-month revenue figure represented a decrease of -29.73% year-over-year.
• The revenue for the quarter ending September 30, 2025, was reported as $57.94 million, showing a 27.80% growth for that specific quarter.

Realized and unrealized gains/losses on investment securities and hedges directly impact the economic return realized by shareholders. The market conditions in Q3 2025, including declining interest rate volatility and a favorable reversal in swap spreads, provided a tailwind. This performance translated into an economic return for the quarter of 8.7%.

Shareholder distributions are a key part of the return profile. Invesco Mortgage Capital Inc. declared a quarterly common stock dividend of $0.34 per share for the third quarter of 2025. This dividend was unchanged from the second quarter of 2025. The book value per common share increased to $8.41 as of September 30, 2025, up from $8.05 at the end of Q2 2025.

Here's a quick look at the key Q3 2025 metrics that feed into the revenue realization:

The company also raised capital during the quarter, selling shares for net cash proceeds of $36.1 million through its at-the-market program.