Ellington Credit (EARN) Stock: Buy, Sell, or Hold?
EARN - Ellington Credit Company
$4.32
0.01 (0.23%)
▲
5d:
-1.37%
30d:
-0.69%
90d:
-8.09%
WAIT
LOW Confidence
Analysis Updated: Sep 11, 2026 12:00 AM ET
Earnings: Aug 12, 2026
0d
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Interactive Price Chart (1 Month)
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Bottom Line:
📊 MIXED SIGNALS: EARN shows conflicting indicators. Wait for confirmation before entering.
📊 MIXED SIGNALS: EARN shows conflicting indicators. Wait for confirmation before entering.
Long-Term Wealth Forecast (2031)
Based on Analyst Consensus Growth & Historical Valuation
0% (Stagnation)
50% (Hyper Growth)
EST. PRICE IN 2031
$7.70
Based on 9.3% avg growth
INTRINSIC VALUE TODAY
$4.78
9.6% Margin of Safety
How this is calculated: We use a Growth Decay Model: starting with analyst consensus growth (adjusted above) and gradually slowing it down to a long-term terminal rate (4%) by Year 5. This provides a more realistic valuation than assuming constant hyper-growth. We then apply a 4.5x Exit PE.
In-depth Analysis How we analyze
Valuation Analysis: EARN is currently trading at $4.32, which is considered oversold relative to its 30-day fair value range of $4.33 to $4.43. From a valuation perspective, the stock is trading at a discount (Forward PE: 3.9) compared to its historical average (4.5). Remarkably, the market is currently pricing in an annual earnings decline of 4.4% over the next few years. This pessimistic expectation contrasts with the company's recent 69.8% earnings growth, suggesting potential undervaluation if the company simply maintains stability.
Technical Outlook: Technically, EARN is in a strong downtrend. The price is currently testing key support at $4.29. A bounce from this level would confirm strength, while a break below could signal further downside.
Market Sentiment: The stock scores a mixed 44/100 on our bottoming-setup gauge, with only partial signs of a stabilized entry point. Wall Street analysts see significant upside, with an average price target of $5.00 (+15.7%). Current signals suggest waiting for a better entry point before initiating new positions.
Technical Outlook: Technically, EARN is in a strong downtrend. The price is currently testing key support at $4.29. A bounce from this level would confirm strength, while a break below could signal further downside.
Market Sentiment: The stock scores a mixed 44/100 on our bottoming-setup gauge, with only partial signs of a stabilized entry point. Wall Street analysts see significant upside, with an average price target of $5.00 (+15.7%). Current signals suggest waiting for a better entry point before initiating new positions.
Quick Decision Summary
Current Position
OVERSOLD
Historical Trading Range
$4.33 -
$4.43
Company Quality Score
46/100
(HOLD)
Volume Confirmation
HIGH
Confidence Score
77.1%
All Signals
- BULLISH: Price oversold vs 30-day range
- NEUTRAL: Mixed technical signals (44/100)
- BULLISH: High volume confirmation
- BULLISH: Trading below Wall St target ($5.00)
- WARNING: Composite score 46/100 in the bottom quintile — this cohort historically lags the market
Trading Range Analysis
30-Day Trading Range
$4.33 -
$4.43
Current vs Trading Range
OVERSOLD
Support & Resistance Levels
Support Level
$4.29
Resistance Level
$4.50
Current Trend
Strong Downtrend
Technical data as of
Sep 11, 2026
Fundamental Context
Forward P/E (Next Year Est.)
3.93
Wall Street Target
$5.00
(+15.7%)
Revenue Growth (YoY)
-19.3%
Earnings Growth (YoY)
69.8%
Profit Margin
-81.2%
Valuation Discount vs History
-4.4% cheaper
PE vs Historical
3.9 vs 4.5
CHEAP
Market-Implied Price Targets
If current PE multiple persists
Implied Growth (YoY):
-4.4%
(market-implied from PE analysis)
1-Year Target
$4.13
(-4%)
2-Year Target
$3.95
(-9%)
3-Year Target
$3.77
(-13%)
3-Yr Target (if PE normalizes)
(PE: 4→5)
$4.32
(+0%)
3-Year Scenarios
Using analyst projected EPS growth
Bull:
(PE: 20.2, Growth: 14.6%)
$33.38
(+673%)
Base:
(SPY PE: 3.9, Growth: 14.6%)
$6.50
(+50%)
Bear:
(PE: 3.3, Growth: 14.6%)
$5.52
(+28%)
📈
Valuation based on Current Earnings
RECOVERY PLAY: Stock looks expensive now (15x PE), but valuation improves significantly next year (4x PE) as earnings recover.
Trailing PE: 15.39 | Current EPS (TTM): $0.28
Bull Case
$9.48
(+120%)
Analyst growth 100.0%, PE expands to 16.9
Base Case
$8.62
(+100%)
Market implied 100.0%, PE stable at 15.4
Bear Case
$2.93
(-32%)
Severe decline -20.0%, PE contracts to 13.1
These are projections based on PE multiples and EPS growth scenarios, not predictions. Actual results may vary significantly.
💡
Upside Surprise Potential
If earnings stabilize (0% growth), PE could expand from 3.9 to 4.5
Stabilization Target:
$4.95
(+14.6%)
PE Expansion Potential:
+14.6%
Share & Embed Analysis
Last updated: September 13, 2026 9:59 PM ET
Data refreshes hourly during market hours. Next update: 10:59 PM
Data refreshes hourly during market hours. Next update: 10:59 PM
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| Ticker | Score | Recommendation | Change % |
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Technical Signals Check
Is EARN showing a specific setup today?
Insider Activity (6 Months)
0
Buys
0
Sells
0
Net
NEUTRAL
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