New York Mortgage Trust ((NYMT)) has held its Q1 earnings call. Read on for the main highlights of the call.
Confident Investing Starts Here:
- Quickly and easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions
- Receive undervalued, market resilient stocks straight to you inbox with TipRanks' Smart Value Newsletter
New York Mortgage Trust’s recent earnings call conveyed a generally positive sentiment, underscoring significant strides in investment activity, liquidity, and earnings. Despite some setbacks from derivative losses and market volatility, the company’s strategic repositioning has bolstered its financial metrics and liquidity stance.
Increased Investment Activity and Earnings
The company has notably doubled its investment activity compared to the previous quarter, which has led to recurring earnings that align with a dividend of $0.20 per share. This achievement was made possible by unlocking excess liquidity and investing in highly liquid Agency RMBS and short-duration credit assets within the residential BPL sector.
Improved Liquidity and Financial Position
New York Mortgage Trust reported a nearly 20% increase in excess liquidity from the previous quarter, culminating in $407 million of excess liquidity after adding $1.8 billion in investments. This improvement underscores the company’s enhanced financial position.
Earnings Available for Distribution (EAD) Increase
The company saw its Earnings Available for Distribution (EAD) per share rise to $0.20 in Q1 2025, up from $0.16 in the previous quarter. This increase reflects the strategic repositioning of the company’s portfolio.
Net Unrealized Gains
The firm recognized net unrealized gains totaling $118.2 million, primarily attributed to higher valuations in its Agency RMBS portfolio and residential loan book.
Record Agency RMBS Purchases
New York Mortgage Trust made record purchases of approximately $1.5 billion in Agency RMBS, nearly quadrupling the amount from the prior quarter.
Unrealized Losses from Derivatives
The company faced unrealized losses of approximately $71.3 million from derivative instruments, mainly due to interest-rate swaps.
Modest Net Realized Losses
The earnings call reported net realized losses of about $2.3 million from investment activities.
Impact of Market Volatility on Book Value
The adjusted book value as of April month-end is estimated to have decreased by approximately 1.5%, reflecting the impact of market volatility.
Non-recurring Expenses
The company incurred $5.4 million in debt issuance costs due to the issuance of senior unsecured notes and securitizations during the quarter.
Forward-Looking Guidance
Looking ahead, New York Mortgage Trust is optimistic about its strategic portfolio restructuring, which focuses on high-liquidity Agency RMBS and short-duration credit assets in the residential BPL sector. The company has doubled its investment activity, increased its excess liquidity to $407 million, and reduced its recourse leverage ratio to 0.5 times. These adjustments are seen as steps toward sustaining liquidity and positioning the company for robust future growth.
In summary, the New York Mortgage Trust earnings call highlighted a positive outlook with significant advancements in investment activity and financial positioning. Despite some challenges from market volatility and derivative losses, the company’s strategic repositioning has resulted in improved earnings and liquidity, setting a strong foundation for future growth.