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ARMOUR Residential REIT
(NYSE:ARR)
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Rating:62Neutral
Price Target:
$17.00
â–²(4.49% Upside)
Action:Reiterated
Date:07/25/26
ARR’s score is supported most by very attractive valuation (low P/E and high dividend yield) and a constructive earnings-call backdrop highlighting strong Q2 results, liquidity, and disciplined hedging. These positives are tempered by elevated financial risk from very high leverage and weak technical momentum (negative MACD, bearish RSI, and price below key short/intermediate moving averages).
Positive Factors
Asset Quality - Agency RMBS
A >$22B portfolio concentrated in agency RMBS and agency CMBS materially lowers credit risk versus private-label MBS. The size and >95% specified-pool focus improve diversification and prepayment visibility, supporting more durable cash flows and dividend capacity over cycles.
Negative Factors
Very High Leverage
Debt-to-equity near 8x represents very high financial leverage, magnifying exposure to funding-cost increases and mark-to-market declines in MBS values. Such gearing reduces margin for error, increases rollover and collateral risk, and can pressure dividends or force asset sales in stressed markets.
Read all positive and negative factors
Positive Factors
Negative Factors
Asset Quality - Agency RMBS
A >$22B portfolio concentrated in agency RMBS and agency CMBS materially lowers credit risk versus private-label MBS. The size and >95% specified-pool focus improve diversification and prepayment visibility, supporting more durable cash flows and dividend capacity over cycles.
Read all positive factors
ARMOUR Residential REIT Key Performance Indicators (KPIs)
Any
Implied Leverage
An estimate of how much the REIT is amplified by borrowing and derivatives relative to its equity. Higher implied leverage can boost yields in good markets but also magnifies losses and increases solvency and liquidity risk during stress.
An estimate of how much the REIT is amplified by borrowing and derivatives relative to its equity. Higher implied leverage can boost yields in good markets but also magnifies losses and increases solvency and liquidity risk during stress.
Data provided by:
The Fly
The FlyARMOUR Residential REIT (ARR) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.32B
Dividend Yield17.6%
Average Volume (3M)4.13M
Price to Earnings (P/E)4.4
Beta (1Y)0.61
Revenue Growth34.24%
EPS GrowthN/A
CountryUS
EmployeesN/A
SectorReal Estate
Sector Strength53
IndustryREIT - Mortgage
Share Statistics
EPS (TTM)3.73
Shares Outstanding141,553,040
10 Day Avg. Volume5,010,616
30 Day Avg. Volume4,133,553
Financial Highlights & Ratios
PEG Ratio>-0.01
Price to Book (P/B)0.73
Price to Sales (P/S)1.27
P/FCF Ratio13.38
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusHold
Number of Analyst Covering1
EPS Forecast (FY)2.95
Revenue Forecast (FY)$459.86M
ARMOUR Residential REIT Business Overview & Revenue Model
Company Description
ARMOUR Residential REIT, Inc. (ARR), founded in 2008 and based in Vero Beach, Florida, primarily allocates its capital to residential mortgage-backed securities (MBS) within the United States. Its investment holdings predominantly comprise MBS tha...
How the Company Makes Money
ARR primarily makes money from net interest income generated by its mortgage investment portfolio. The core model is to (1) buy RMBS—primarily agency RMBS that carry minimal credit risk due to government or GSE guarantees—then (2) finance a signif...
ARMOUR Residential REIT Earnings Call Summary
Earnings Call Date:Jul 22, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 28, 2026
Earnings Call Sentiment Positive
The call presented multiple clear strengths: solid Q2 economic return (4.8%), strong GAAP and distributable earnings, successful capital raises, maintained dividends, portfolio growth (+$1.3B added) and liquidity above $1.2B. Management also emphasized disciplined risk management (near-zero duration, robust hedging) and attractive incremental return opportunities. Offsetting risks include macro and Fed-policy uncertainty, bear-flattening of the curve (2yr +38 bps, 10yr +15 bps), signs of cooling investor demand, valuation constraints in specified pools, and a modest downward trend in liquidity as a percent of equity. Overall, highlights materially outweigh the lowlights, but management remains cautious given external risks.Positive Updates
Total Economic Return and Earnings
Delivered total economic return of 4.8% for Q2 2026. GAAP net income available to common stockholders of $111.5 million ($0.86 per common share). Net interest income was $76.8 million. Distributable earnings available to common stockholders were $93.2 million ($0.72 per common share).
Negative Updates
Macroeconomic and Policy Uncertainty
Fed policy under new leadership increased uncertainty and potential interest-rate volatility. U.S. Treasury curve bear-flattened in the quarter (2-year yield rose 38 bps; 10-year rose 15 bps), creating a historically unfavorable backdrop for mortgages and posing risk of wider spreads if inflation or Fed hawkishness persists.
Read all updates
Q2-2026 Updates
Positive
Negative
Total Economic Return and Earnings
Delivered total economic return of 4.8% for Q2 2026. GAAP net income available to common stockholders of $111.5 million ($0.86 per common share). Net interest income was $76.8 million. Distributable earnings available to common stockholders were $93.2 million ($0.72 per common share).
Read all positive updates
Company Guidance
ARMOUR’s guidance is cautious but constructive: management expects supportive technicals into Q3 with mortgage spreads modestly wider yet still inside long‑ and short‑term averages and a base case that the Fed stays on hold through the fall; they target a near‑0 net balance sheet duration, implied leverage of ~7.5x (management used 8x in a return example), a portfolio >$22B (100% Agency MBS/Agency CMBS/Treasuries, >95% specified pools) with ~$1.3B of purchases since April, and July month‑end liquidity >$1.2B (nearly 50% of equity) including monthly paydowns; Q2 metrics underpinning the outlook: total economic return 4.8%, GAAP net income $111.5M ($0.86/sh), net interest income $76.8M, distributable earnings $93.2M ($0.72/sh), quarterly common dividend $0.72 ($0.24/mo), quarter‑end book value $17.53 (estimated $17 on July 20); prepayments averaged 11.4 CPR in Q2 (down to 8.8 CPR in July), ~86% of hedges are OIS/SOFR pay‑fixed swaps, and capital raise activity was ~$218.7M common (12.7M shares) and ~$4.1M preferred (198k shares) in Q2 (plus $88.3M common through July 14); example economics cited: static mid‑teens returns on 30‑year 5s–6s at 8x leverage hedged to 0.5yr, with a 10bp OAS tightening potentially adding ~4–5% to total return.ARMOUR Residential REIT Financial Statement Overview
Summary
Income Statement
68
Positive
Balance Sheet
34
Negative
Cash Flow
62
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.01B | 1.31B | 239.90M | 449.67M | -877.95M | 4.89M |
| Gross Profit | 964.15M | 1.27B | 206.77M | 418.09M | -903.93M | -17.61M |
| EBITDA | 993.97M | 966.80M | 509.75M | 457.87M | -92.63M | 70.58M |
| Net Income | 430.93M | 322.69M | -14.39M | -67.92M | -229.93M | 15.36M |
Balance Sheet | ||||||
| Total Assets | 22.75B | 21.01B | 13.55B | 12.34B | 9.44B | 5.28B |
| Cash, Cash Equivalents and Short-Term Investments | 83.68M | 63.27M | 67.97M | 221.89M | 87.28M | 337.66M |
| Total Debt | 19.44B | 17.94B | 0.00 | 0.00 | 0.00 | 0.00 |
| Total Liabilities | 20.17B | 18.74B | 12.19B | 11.07B | 8.32B | 4.13B |
| Stockholders Equity | 2.58B | 2.26B | 1.36B | 1.27B | 1.11B | 1.14B |
Cash Flow | ||||||
| Free Cash Flow | 319.49M | 124.20M | 261.46M | 132.82M | 124.08M | 11.74M |
| Operating Cash Flow | 319.49M | 124.20M | 261.46M | 132.82M | 124.08M | 11.74M |
| Investing Cash Flow | -6.89B | -7.28B | -1.69B | -3.04B | -3.89B | 503.58M |
| Financing Cash Flow | 6.58B | 7.30B | 1.31B | 3.05B | 3.53B | -330.77M |
ARMOUR Residential REIT Technical Analysis
Negative
16.27
Price Trends
16.60
Negative
16.46
Negative
16.06
Positive
Market Momentum
-0.10
Positive
42.02
Neutral
14.05
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ARR, the sentiment is Negative. The current price of 16.27 is below the 20-day moving average (MA) of 16.65, below the 50-day MA of 16.60, and above the 200-day MA of 16.06, indicating a neutral trend. The MACD of -0.10 indicates Positive momentum. The RSI at 42.02 is Neutral, neither overbought nor oversold. The STOCH value of 14.05 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ARR.
ARMOUR Residential REIT Risk Analysis
ARMOUR Residential REIT disclosed 62 risk factors in its most recent earnings report. ARMOUR Residential REIT reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
ARMOUR Residential REIT Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
65 Neutral | $2.17B | 12.19 | 3.79% | 4.94% | 3.15% | 1.96% | |
64 Neutral | $3.19B | 4.87 | 16.91% | 16.19% | 136.45% | 234.34% | |
62 Neutral | $2.32B | 4.40 | 18.52% | 17.70% | 34.24% | ― | |
62 Neutral | $1.70B | 8.16 | 11.88% | 11.67% | 33.43% | 19.55% | |
57 Neutral | $1.25B | 23.43 | 3.57% | 9.42% | -5.22% | -40.61% | |
52 Neutral | $881.27M | 8.41 | 6.88% | 42.82% | 3.09% | ― | |
49 Neutral | $1.06B | -23.94 | 0.75% | 13.12% | 10.27% | -151.66% |
* Real Estate Sector Average
ARR
ARMOUR Residential REIT
16.45
2.71
19.76%
ARI
Apollo Real Estate
6.50
0.75
12.98%
CIM
Chimera Investment
12.66
0.88
7.49%
DX
Dynex Capital
12.82
2.17
20.36%
EFC
Ellington Financial
13.49
2.10
18.48%
LADR
Ladder Capital
9.70
-0.30
-3.04%
ARMOUR Residential REIT Corporate Events
Business Operations and StrategyPrivate Placements and FinancingRegulatory Filings and Compliance
ARMOUR Residential REIT Expands Equity Issuance Capacity
Positive
Jul 24, 2026
On July 24, 2026, ARMOUR Residential REIT amended its equity sales agreement for its at-the-market offering program, raising by 25 million the number of common shares that can be issued and bringing the total capacity under the amended arrangement...
Business Operations and StrategyDividendsFinancial Disclosures
ARMOUR Residential REIT Reports Solid Q2 2026 Results
Positive
Jul 22, 2026
On July 22, 2026, ARMOUR reported unaudited second-quarter 2026 results, posting GAAP net income attributable to common shareholders of $111.5 million, or $0.86 per share, and a total economic return of 4.8% for the period. Net interest income rea...
Business Operations and StrategyDividendsFinancial Disclosures
ARMOUR Residential REIT Issues July 2026 Financial Update
Positive
Jul 22, 2026
On July 22, 2026, ARMOUR Residential REIT released a July 2026 monthly update detailing its financial position, portfolio composition and funding arrangements as of June 30, 2026. The report underscores ARMOUR’s focus on agency mortgage-back...
Business Operations and StrategyFinancial Disclosures
ARMOUR Residential REIT to Announce Q2 2026 Results
Positive
Jul 21, 2026
On July 21, 2026, ARMOUR Residential REIT, Inc. announced it will host an online, real‑time webcast of its conference call with equity analysts to discuss operating results for the second quarter ended June 30, 2026. The webcast is scheduled...
Business Operations and StrategyDividends
ARMOUR Residential REIT Declares August 2026 Monthly Dividend
Positive
Jul 21, 2026
ARMOUR Residential REIT, Inc., a U.S. real estate investment trust focused on agency residential mortgage-backed securities, relies on regular distributions of taxable income to shareholders to preserve its REIT tax status. The company’s boa...
Business Operations and StrategyDividends
ARMOUR Residential REIT Confirms July 2026 Cash Dividends
Positive
Jul 1, 2026
On July 1, 2026, ARMOUR Residential REIT, Inc. confirmed a cash dividend of $0.24 per share on its common stock for July 2026, payable on July 30, 2026, to shareholders of record as of July 15, 2026. The confirmation aligned with prior guidance an...
Dividends
ARMOUR Residential REIT Issues July 2026 Dividend Guidance
Positive
Jun 24, 2026
On June 24, 2026, ARMOUR Residential REIT, Inc. announced guidance for a July 2026 cash dividend of $0.24 per common share, reflecting the company’s ongoing practice of distributing income to shareholders. The dividend will be paid on July 3...
Business Operations and StrategyDividendsFinancial Disclosures
ARMOUR Residential REIT Issues June 2026 Portfolio Update
Neutral
Jun 12, 2026
On June 12, 2026, ARMOUR Residential REIT released a June 2026 update detailing its portfolio and capital structure as of May 31, 2026, with CPR data as of June 4, 2026, showing a $22.2 billion portfolio heavily concentrated in agency mortgageR...
Dividends
ARMOUR Residential REIT Declares June 2026 Cash Dividend
Positive
May 28, 2026
On May 28, 2026, ARMOUR Residential REIT, Inc. declared a June 2026 cash dividend of $0.24 per common share, reinforcing its income-distribution profile for shareholders. The dividend will be paid on June 29, 2026, to stockholders of record as of ...
Business Operations and StrategyDividendsFinancial Disclosures
ARMOUR Residential REIT Issues May 2026 Company Update
Neutral
May 15, 2026
ARMOUR Residential REIT released a May 2026 company update presentation on May 15, 2026, detailing its portfolio and capital structure as of April 30, 2026, and prepayment data as of May 6, 2026. The $21.7 billion portfolio is 93.7% agency mortgag...
Business Operations and StrategyShareholder Meetings
ARMOUR Residential REIT Shareholders Approve Expanded Incentive Plan
Positive
Apr 30, 2026
At its annual meeting on April 30, 2026, ARMOUR Residential REIT stockholders approved the Fourth Amended and Restated 2009 Stock Incentive Plan, expanding the pool of authorized common shares for equity and cash-based awards by 1,000,000 and upda...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.