UPDATE 1-Thornburg Mortgage quarterly profit rises, shares up

(Recasts, adds details, outlook, share movement)

July 19 (Reuters) - Mortgage lender Thornburg Mortgage Inc. TMA.N reported a higher second-quarter profit that beat analysts' estimates, citing better margins as returns on new mortgage assets improved.

Thornburg Mortgage also said it expects earnings for 2007 to exceed the high end of the current analysts' estimates range.

Shares of the company rose more than 6 percent in late electronic trade.

Mortgage originations for the second quarter rose 21 percent to $1.7 billion, Thornburg said in a statement.

"...The credit performance of our prime quality mortgage loan portfolio remained exceptional...," Chairman and Chief Executive officer Garrett Thornburg said.

The Santa Fe, New Mexico-based company reported second-quarter net income of $83.4 million, or 66 cents a share, up from $69.7 million, or 61 cents a share, a year ago.

Net income available to common shareholders rose to $78.1 million from $67.2 million a year earlier.

Taxable earnings for the quarter are estimated to be 65 cents a share, the company said.

Analysts on average expected earnings of 61 cents, before exceptional items, according to Reuters Estimates.

Shares of the company rose to $27.14 in late electronic trade, after closing at $25.53 Thursday on the New York Stock Exchange. (Reporting by Shikhar Balwani in Bangalore)