Seeking Alpha • Oct 14

New York Mortgage Trust State Of Mind

Summary Talk about a beat down, New York Mortgage Trust survives the 2008 meltdown only to be treated like bankruptcy bait in 2022. Did management lose the lessons that helped them over past crises? This Hybrid residential/multifamily mortgage REIT has a quality asset portfolio. We compare to other hybrid mREITs for relative valuation and find one security we recommend today. New York Mortgage Trust (NYMT) invests up and down the housing market. From multifamily (32% of total portfolio) to single family mortgage products (40% Agency 40%, 8% Non-Agency), NYMT is a housing lender/investor. There is a Freddie Mac commercial mortgage security held (1%) and a catch-all bucket of Other that includes "business-related" housing loans like "fix and flip", rentals, other multifamily assets, mortgage servicing revenues, etc. (19%). There is only $2.55MM in real estate owned in June 2022 versus $2.05MM in December 2021, representing a literal rounding error in an almost $4BN residential portfolio. These have generally been sold at a profit given the record equity supporting the housing market today. What's wrong with this portfolio that it deserves to trade at $2.45 when Wall St. estimates the current NAV (net asset value) at $3.93 per share (Source: Koyfin), a 38% discount? Let's take a dive. NYMT Portfolio Quality We know 40% represents investment in quasi-US government guaranteed mortgages - the best quality one can own. But what NYMT holds is more than just the whole loan, they hold some volatile loan slices called IOs, sort of like side bets on a football game. We will discuss in greater detail. 8% is non-agency, primarily non-mark-to-market home loans and investment securities we will discuss in greater detail because I found a lot of side bets here, too. Multifamily makes up 32% percent of the portfolio. We know multifamily has been on fire in the good way, but what is the overall quality of this portfolio? We know some is Freddie Mac quasi-government, but not much more. The very small commercial mortgage is a Freddie Mac multifamily loan securitization that is solid, leaving that 19% catchall: NYMT Q2 2022 Other Assets (NYMT 2022 Q2 form 10-Q) Not much to see other than accrued flows running through the mortgage servicing rights and other normal course of business issues. Agency Mortgage Assets NYMT buys more than just agency loans, it also buys asset back bonds secured by these loans. These usually come from specialized financing vehicles (SPEs) in which a lender or asset holder like NYMT contributes a pool or pile of Agency mortgages to the SPE. The SPE carves the pool into slices that have varying claims on the cash flows (interest, prepayment fees, principal) from the pool in exchange for absorbing any problems that might crop up within the SPE loan portfolio. These range from the most protected AAA rated slices to the wildest pieces that include things like interest only, inverse interest only and first loss reserve slices - exotic stuff in both the dowdy Agency market and in NYMT's asset portfolio. By wild, we mean volatile. For example, interest only means if interest payments are deferred or defaulted, that's your entire income stream on that slice - you are in far more trouble than someone who owns both the interest and the claim on the principal loan amount (far more secure in the moment). A first loss reserve means if there are defaults (losses), it comes out of your slice first and is only recoverable if the value lost is later recovered - can be a really bad or really good place to be. We are focusing on the exotica because in volatile markets, holding these the wrong way can have outsized negative effects. What are they holding and how is it pointing? NYMT Assets (NYMT 2022 Q2 form 10-Q) We are going to focus on the Consolidated SLST line (defined, below) which comprises less than 5% of the total residential portfolio, but how much of the common equity cushion would that eat? Almost 25% at today's share price - big bite. SLST is formed when: "The Company invests in subordinated securities that represent the first loss position of the Freddie Mac-sponsored residential loan securitization from which they were issued, and certain IOs and senior securities issued from the securitization." That's what we call high leverage exotica because small moves against your position have high leverage effects on the results. This demands an examination of the housing market risks in the coming recession. The rest of this portfolio is solid gold. Non-Agency Mortgage Assets Similar to the Agency without the government guarantee. All loans are performing fine, but there's SLST here, too - about 40% of the $50MM in non-agency residential mortgage backed securities ((RMBS)), or another $19MM in SLST exotica. This could eat almost another 20% of the equity if wiped out. Otherwise, NYMT has shrunk this part of their portfolio since 2021. Multifamily Mortgage Assets Here we get a variety of participation slices that range from a standard mortgage to effective equity ownership. Multifamily Portfolio Summary (Q2 2022 Investor Presentation) We have some very good metrics here. Relatively high occupancy with 12% rent growth in 2022 already (ahead of inflation) with 2 loans having fully repaid and only one out of 28 loans struggling enough to be delinquent. One might wonder whether any of the 8 Floridian properties experienced uninsured damage by Hurricane Ian. That we have heard nothing is likely good news because insurance filings have happened by now. We would also like to observe that LTV, or loan to value, might look high. Those assets are not marked-to-market for current value. Since we know how rent has risen the past two years for NYMT (20%), we can imply better loan to value ratios than reported in their financial statements. Asset Conclusions Any discussion about a residential mREIT must start with asset quality. NYMT has a systematically more risky asset portfolio than an Agency REIT like Annaly (NLY) or AGNC (AGNC) whose portfolios are 90%+ quasi-government guaranteed assets. NYMT holds 40% with bulk of the rest in harder to score assets. The good news is the following: Housing values are high. With the vast bulk of existing mortgages fixed rate in the 3% range or less, interest rate rises do not affect mortgage holder ability to pay. Employment is so high the Fed is free to raise rates until unemployment or a liquidity crisis interrupts the process. Demand for housing is very high with supply constrained and years behind in catching up. Even a 10% decline in housing values would not materially increase defaults. Executive Chairman Steven R. Mumma has been there in a variety of roles through all the changes. I found nothing negative on sites like Glassdoor. There's risky news here too: Almost 8% of the portfolio holds exotic pieces of mortgage pools that could have outsized effects on the common stock. Equity ownership in multifamily properties is not nearly as secure as being the mortgage lender only. The company provides no color on multifamily asset class or quality. On a scale of 1 to 5 where 1 is the least risky residential mREIT (AGNC would be our model 1 with NLY at 1.5), we consider this a comfortable middle-of-the-road 3. We assign a positive tailwind to the 3 because the exotica is generally pointing in the right direction, giving us a 2.8. What do we mean? IOs and First Loss Slices IO stands for securities that either receive interest only or, get ready for this one, inverse interest only. The interest paid to the holder only rises or floats upward when the mortgage is also floating rate and rates rise. Inverse IOs, on the other hand, would pay lower interest as the index rate rises. High leverage stuff and we have no visibility as to how they are tilting overall other than we know that management is awake at the wheel. NYMT knows what day it is and has been here before, so I believe they are more likely long IO rather than inverse IO instruments today. The other part, which is so interesting, are the first loss slices on Freddie Mac mortgages that maybe either single or multifamily properties. Given the high equity values and relatively cheap fixed rate mortgages, we see this pointing in the right direction and believe there is value in these pieces. Hence, our positive tailwind adjustment. Outlook and Strategy The company's strategy rolling forward is focused on the entire residential housing sector: "In light of current market conditions, which includes increased volatility in interest rate, credit, mortgage and financial markets and the increasing risk of the U.S. economy experiencing a recession within the next 12 months, we currently intend to pursue selective investments across the residential housing sector, with a focus on generating higher portfolio turnover by increasing our allocation to higher coupon, short duration residential investor loans, consider the opportunistic disposition of assets from our portfolio and prudently manage our liabilities. We believe these actions, combined with our strong balance sheet and cash position, will help to protect our undepreciated book value per common share during the expected continued volatile periods in the near future and will better enable us to rapidly reposition our portfolio in a higher interest rate environment and position us to deploy capital and seize on superior market opportunities in the market cycles ahead." Given the economic winds, looming recession with rising rates, we like the strategy. By focusing in non-mark-to-market sectors while housing supply remains short strikes us as a viable strategy one would not have used during 2008. They are adapting rather that re-running an old playbook. Take a look at how their loan portfolio has been performing: NYMT Q2 2022 Loan Performance (NYMT 2022 Q2 form 10-Q) We see loan to value percentages at far more conservative levels than the end of 2007. Even a 10% haircut to asset values would not trigger heavy problems. Values most likely will not crater without another Black Swan event. There is risk here; and we see it being managed as NYMT adapts to the 2022-2023 environment in ways we believe will generate positive returns on investment (shorter time duration loans) plus trading in the seasoned agency market. NYMT appears well positioned to survive from an asset perspective. What about the financing stack? What are the risks and opportunities? The Liability Side Supporting all these assets is a load of debt. We have about $6.8BN in real estate related assets (excludes cash) of which about $5.1BN are financed by a combination of short and long term financings as well as another approximately $538MM in preferred stocks, leaving about $1.6BN in equity cushion. Absent a liquidity crisis, we see NYMT continuing the orderly process of shifting their portfolio with market forces down the path of least resistance for their strategy. If NYMT cannot finance itself efficiently because of rate spikes in the short term markets or it's leverage slips out of balance, it will need to issue secondary equity to support the portfolio. The asset quality leads us to believe straight equity will cost NYMT more than a pure agency REIT and why we are glad it carries a lower total debt to equity ratio than its hybrid peers. It would also be highly dilutive to the common if Wall St. analyst NAV estimates are correct. Valuation Analysis That was a long road through NYMT land. How does it compare to its peer group? We have selected the following hybrid residential mREIT competitors: Chimera Investment (CIM), MFA Financial (MFA), Ellington Financial (EFC), and Arlington Asset Management (AAIC). Of these, AAIC has adopted the novel strategy to forego a common dividend in favor of common stock repurchases. Ticker Total Debt/ Total Capital Preferred Stock Amt Outstanding ($'000) Percent of Shareholder Equity Total Debt + Preferred / Total Capital Est. NAV per Share* Share Price 10/13/22 Discount to NAV NYMT 69.42% 538.2 24.3% 76.8% $3.93 $2.42 38.4% CIM 78.59 372.0 12.5 81.3 8.34 5.39 35.4 MFA 76.98 190.0 8.9 79.0 15.46 8.16 47.2 EFC 79.09 227.4 18.4 82.9 16.55 11.66 29.6 AAIC 77.70 34.6 16.2 81.3 6.22 2.82 54.7 Source: SA, Koyfin and Q2 2022 Form 10-Qs for each issuer. Such interesting results. We first have to ask the age old question from the 1970's, "is it a floor wax or a dessert topping?" The preferred stock is what we are trying to understand more deeply. Traditional leverage ratios treat preferred more like permanent capital (which it could be) than a debt vehicle (which it could be). Which is it? We submit that depends on how any particular industry treats it. While Dan Ackroyd answered the floor wax question, we'll handle the leverage one. If we look at NYMT's unsecured debt obligations, we see one issued at 5.75% fixed from 2021 and another two at LIBOR + 3.75 and 3.95 percentage points that each mature in 2035. Their preferred stocks boast current fixed rate coupons of 6.75%, 7.875%, 8% and 7%. More or less where one might expect coupons on next tranche lower in the financing stack (risk premium). By comparison to our peer group: CIM has no long term loans; MFA has no long term loans; EFC has 5.875% Senior Unsecured Notes with a 6.75% Preferred; AAIC has 6.75% unsecured debt due 2025 with an 8.25% Preferred. In all these cases, the referred range of coupon seems like the next reasonable step down the claims ladder (granted, for a more nuanced analysis, we would need to examine credit spreads on the day these were priced. I'm not doing that).

Seeking Alpha • Aug 26

New York Mortgage Trust: A Sustainable Dividend, But Wait For A Better Risk/Reward

Summary The Financials sector has seen 14 straight weeks of fund outflows. NYMT is a small REIT that pays a dividend above 13% but is not currently profitable. With negative earnings, the charts say wait for a better entry point before going after NYMT's big yield. Investors continue to flee Financials. The sector has struggled amid a flat to inverted yield curve this year despite some benefits from higher deposit rates. EPFR data show a staggering 14 straight weeks of outflows from the value-oriented group. One small REIT within the sector has seen its share of struggles lately, but it also pays an extremely high dividend yield. Investors Jump Ship From Financials BofA Global Research According to Bank of America Global Research, New York Mortgage Trust (NYMT) is an internally managed REIT that invests in residential mortgage loans, Agency RMBS, and multi-family commercial mortgage-backed securities, as well as mezzanine loans and preferred equity investments. NYMT's objective is to deliver long-term stable distributions to stockholders over a range of economic conditions through a combination of net interest margin and capital gains. The portfolio is actively managed to maintain dividend and book value stability. The New York City-based and Nasdaq-listed $1.1 billion market cap Mortgage REIT industry company within the Financials sector has negative earnings over the past 12 months and negative profits are seen in 2022. Its trailing 12-month price-to-book ratio is low at just 0.72. The stock pays a whopping 13.5% dividend yield, according to The Wall Street Journal. BofA analysts see operating earnings turning positive by 2023 and growing further in 2024. GAAP EPS should still be in the red, though. BofA believes NYMT's beefy dividend will remain intact over the coming quarters and years. Of course, REITs are required to pay out 90% of profits as dividends. NYMT Earnings, Dividend, Valuation Forecasts BofA Global Research Unfortunately, the company has badly missed on earnings in the previous two quarters. Not surprisingly, NYMT got sliced in half from its mid-2021 peak near $5 to the low this past June at $2.24. The stock managed to recover in the last two months despite the massive earnings miss reported back on August 3. NYMT Earnings History: Two Big Misses Follow A Pair Of Smaller Misses Seeking Alpha Looking ahead, NYMT's corporate event calendar is light until the next quarterly report unconfirmed to cross the wires on Tuesday, November 1, AMC, according to Wall Street Horizon. NYMT Corporate Event Calendar Wall Street Horizon The Technical Take It doesn't take a CMT to spot the big downtrend off the 2021 zenith. The high of $4.935 notched last year came on a bearish negative RSI divergence, but then this past June's low occurred with bullish positive momentum divergence. The RSI indicator (top) can help spot momentum changes that take place before price inflects. Also on the chart is support around that June low, but that is considerably below the current price. Resistance might be seen just above $3 care of a downtrend line off the 2021 peak. Moreover, a negatively-sloped long-term 200-day moving average suggests that the bears are indeed in control.

Score flocon de neige
Évaluation	3/6
Croissance future	0/6
Performances passées	2/6
Santé financière	1/6
Dividendes	3/6

Historique des cours de bourse
Prix actuel de l'action	US$8.88
Plus haut sur 52 semaines	US$9.32
Plus bas sur 52 semaines	US$6.16
Bêta	1.26
Variation sur 1 mois	13.41%
Variation sur 3 mois	9.09%
Variation sur 1 an	37.46%
Variation sur 3 ans	-4.52%
Variation sur 5 ans	-50.78%
Évolution depuis l'introduction en bourse	-97.52%

	ADAM	US Mortgage REITs	US Marché
7D	-0.4%	-1.2%	-0.8%
1Y	37.5%	2.1%	27.1%

ADAM volatility
ADAM Average Weekly Movement	6.0%
Mortgage REITs Industry Average Movement	3.8%
Market Average Movement	7.2%
10% most volatile stocks in US Market	16.3%
10% least volatile stocks in US Market	3.2%

ADAM statistiques fondamentales
Capitalisation boursière	US$798.87m
Bénéfices(TTM)	US$107.72m
Recettes(TTM)	US$323.40m

ADAM compte de résultat (TTM)
Recettes	US$323.40m
Coût des recettes	US$80.85m
Marge brute	US$242.55m
Autres dépenses	US$134.83m
Les revenus	US$107.72m

Résultat par action (EPS)	1.20
Marge brute	75.00%
Marge bénéficiaire nette	33.31%
Ratio dettes/capitaux propres	764.9%

Données	Dernière mise à jour (heure UTC)
Analyse de l'entreprise	2026/05/21 08:48
Cours de l'action en fin de journée	2026/05/21 00:00
Les revenus	2026/03/31
Revenus annuels	2025/12/31

Paquet	Données	Cadre temporel	Exemple de source américaine ^*
Finances de l'entreprise	10 ans	Compte de résultat Tableau des flux de trésorerie Bilan	Formulaire 10-K de la SEC Formulaire 10-Q de la SEC
Estimations consensuelles des analystes	+3 ans	Prévisions financières Objectifs de prix des analystes	Rapports de recherche des analystes Blue Matrix
Prix du marché	30 ans	Cours des actions Dividendes, scissions et actions	Données de marché ICE Formulaire S-1 de la SEC
Propriété	10 ans	Actionnaires principaux Délits d'initiés	Formulaire 4 de la SEC Formulaire 13D de la SEC
Gestion	10 ans	L'équipe dirigeante Conseil d'administration	Formulaire 10-K de la SEC Formulaire SEC DEF 14A
Principaux développements	10 ans	Annonces de l'entreprise	Formulaire 8-K de la SEC

Analyste	Institution
Mark DeVries	Barclays
Derek Hewett	BofA Global Research
Jason Stewart	Brean Capital Historical (Janney Montgomery)

Adamas Trust (ADAM) Aperçu de l'action

Récompenses

Analyse des risques

Analyst Price Targets

ADAM: Increased Revenue Outlook Will Drive Affordable Housing Demand Forward

Rising Rates And Intensifying Competition Will Squeeze Mortgage Spreads

Aging Demographics And Proptech Will Drive Mortgage Market Expansion

Top Analyst Narratives

ADAM: Increased Revenue Outlook Will Drive Affordable Housing Demand Forward

Rising Rates And Intensifying Competition Will Squeeze Mortgage Spreads

Aging Demographics And Proptech Will Drive Mortgage Market Expansion

Adamas Trust, Inc. Concurrents

MFA Financial

PennyMac Mortgage Investment Trust

Franklin BSP Realty Trust

Ellington Financial

Historique des prix et performances

Nouvelles et mises à jour récentes

Consensus EPS estimates increase by 41%

First quarter 2026 earnings: EPS exceeds analyst expectations while revenues lag behind

New major risk - Revenue and earnings growth

Adamas Trust, Inc. to Report Q1, 2026 Results on Apr 29, 2026

ADAM: Higher Book Value And Run Rate ROE Will Support Future Upside

ADAM: Higher Book Value And Agency Allocation Will Support Future Upside

Recent updates

Consensus EPS estimates increase by 41%

First quarter 2026 earnings: EPS exceeds analyst expectations while revenues lag behind

New major risk - Revenue and earnings growth

Adamas Trust, Inc. to Report Q1, 2026 Results on Apr 29, 2026

ADAM: Higher Book Value And Run Rate ROE Will Support Future Upside

ADAM: Higher Book Value And Agency Allocation Will Support Future Upside

Adamas Trust, Inc., Annual General Meeting, Jun 11, 2026

Fourth quarter dividend of US$0.23 announced

Adamas Trust, Inc. Declares Regular Quarterly Cash Dividend on Common Stock for the First Quarter Ending March 31, 2026, Payable on April 28, 2026

ADAM: Higher ROE Potential And Agency Shift Will Support Future Shareholder Value

Full year 2025 earnings: EPS exceeds analyst expectations while revenues lag behind

New major risk - Revenue and earnings growth

ADAM: Agency Allocation Shift And Margin Durability Will Guide Future Premium Potential

Adamas Trust, Inc. to Report Q4, 2025 Results on Feb 18, 2026

ADAM: Agency Mix Shift And Earnings Resilience Will Shape Future Premium Multiple

ADAM: Agency Shift And Premium P/E Assumptions Will Pressure Future Returns

Adamas Trust ADAMN Preferred Shares Review Results In A Sell Rating

ADAM: Completed Buyback And Steady Outlook Will Support Future Shareholder Value

CEO & Director exercised options and sold US$622k worth of stock

Third quarter dividend of US$0.23 announced

ADAM: Rising Discount Rate And Buybacks Will Shape Future Balance Sheet Dynamics

Adamas Trust, Inc. Declares Cash Dividend for the Quarter Ending December 31, 2025, Payable on January 28, 2026

ADAM: Upcoming Dividend And Ticker Change Will Support Shareholder Value

ADAM: Trust Will Maintain Market Appeal With Upcoming Dividend Announcement

Consensus EPS estimates increase by 25%

ADAM: Increased Revenue Outlook Will Drive Affordable Housing Demand Forward

Third quarter 2025 earnings: EPS exceeds analyst expectations while revenues lag behind

Adamas Trust, Inc. to Report Q3, 2025 Results on Oct 29, 2025

Consensus EPS estimates increase by 10%, revenue downgraded

Second quarter dividend increased to US$0.23

Adamas Trust, Inc. Declares Cash Dividend for the Quarter Ending September 30, 2025, Payable on October 30, 2025

Second quarter 2025 earnings: EPS and revenues miss analyst expectations

New York Mortgage Trust, Inc. (NasdaqGS : NYMT) acquired remaining 50% stake in Constructive Loans, LLC.

New York Mortgage Trust, Inc. to Report Q2, 2025 Results on Jul 30, 2025

First quarter dividend of US$0.20 announced

New York Mortgage Trust, Inc. Declares Quarterly Cash Dividend for the Quarter Ending June 30, 2025, Payable on July 30, 2025

Investments In Agency RMBS Will Unlock New Opportunities

First quarter 2025 earnings: EPS and revenues exceed analyst expectations

New York Mortgage Trust, Inc. to Report Q1, 2025 Results on Apr 30, 2025

New York Mortgage Trust, Inc., Annual General Meeting, Jun 12, 2025

Fourth quarter dividend of US$0.20 announced

Full year 2024 earnings: EPS and revenues exceed analyst expectations

NYMTG: A 9.125% Senior Note IPO From New York Mortgage Trust

New York Mortgage Trust, Inc. to Report Q4, 2024 Results on Feb 19, 2025

Price target decreased by 8.8% to US$9.50

CEO & Director exercised options and sold US$270k worth of stock

Third quarter dividend of US$0.20 announced

New York Mortgage Trust: Updating Our Allocation As The Company Derisks

Third quarter 2024 earnings: EPS exceeds analyst expectations while revenues lag behind

New York Mortgage Trust, Inc. to Report Q3, 2024 Results on Oct 30, 2024

Second quarter dividend of US$0.20 announced

Consensus EPS estimates fall by 18%

New York Mortgage Trust: Agency RMBS May Protect Earnings

Second quarter 2024 earnings: EPS and revenues miss analyst expectations

Insufficient new directors