Armour Residential (ARR)
NYSE:ARR
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ARMOUR Residential REIT
(NYSE:ARR)
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Rating:58Neutral
Price Target:
$17.50
â–¼(-5.71% Downside)
Action:ReiteratedDate:04/02/26
ARR’s score is held back primarily by uneven financial performance and limited technical momentum, despite very strong apparent valuation (low P/E and high yield). The latest earnings call was generally constructive with strong recent economic return, book value improvement, and solid liquidity, but risks like higher prepayments and dilution temper the upside.
Positive Factors
Liquidity & leverage profile
Substantial liquidity (~54% of equity) combined with moderate implied leverage (~7.9x) and a very short net duration (0.14 yrs) provides a durable buffer versus funding stress. This structural liquidity position reduces rollover risk, supports dividend funding flexibility, and limits interest-rate sensitivity over multiple quarters.
Negative Factors
Rising prepayment speeds
Sustained higher CPR materially shortens expected cash flows and forces reinvestment into lower-yielding securities, compressing the net interest spread that drives core earnings. For an mREIT dependent on spread capture, elevated prepayments can erode distributable earnings and book value over several quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
Liquidity & leverage profile
Substantial liquidity (~54% of equity) combined with moderate implied leverage (~7.9x) and a very short net duration (0.14 yrs) provides a durable buffer versus funding stress. This structural liquidity position reduces rollover risk, supports dividend funding flexibility, and limits interest-rate sensitivity over multiple quarters.
Read all positive factors
ARMOUR Residential REIT (ARR) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.07B
Dividend Yield15.06%
Average Volume (3M)3.11M
Price to Earnings (P/E)2.3
Beta (1Y)0.68
Revenue Growth-27.55%
EPS Growth-97.87%
CountryUS
EmployeesN/A
SectorReal Estate
Sector Strength53
IndustryREIT - Mortgage
Share Statistics
EPS (TTM)0.71
Shares Outstanding119,384,920
10 Day Avg. Volume2,032,312
30 Day Avg. Volume3,109,904
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 Cap9.53
Enterprise Value/Revenue15.11
Enterprise Value/Gross Profit15.57
Enterprise Value/Ebitda20.44
Forecast
1Y Price Target
$20.50Price Target Upside10.45% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
EPS Forecast (FY)3.2
Revenue Forecast (FY)$627.82M
ARMOUR Residential REIT Business Overview & Revenue Model
Company Description
ARMOUR Residential REIT, Inc. invests in residential mortgage-backed securities (MBS) in the United States. The company's securities portfolio primarily consists of the United States Government-sponsored entity's (GSE) and the Government National ...
How the Company Makes Money
ARR primarily makes money from the net interest spread generated by its leveraged investments in agency RMBS. It finances a significant portion of its RMBS holdings using short-term borrowings (commonly repurchase agreements), earning interest inc...
ARMOUR Residential REIT Earnings Call Summary
Earnings Call Date:Feb 18, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 29, 2026
Earnings Call Sentiment Positive
The call highlighted several strong operational and financial positives: a robust 10.63% Q4 total economic return, meaningful book value appreciation (+6.5% in Q4), healthy distributable earnings ($79.8M), portfolio growth (>10%) to over $20 billion, strong liquidity (~54% of equity), and improved funding conditions. Key risks were elevated prepayment speeds (CPR rising to 11.1), tighter spreads limiting incremental yield, mild dilution from ATM equity issuance, counterparty concentration in repo, and policy uncertainty around GSE actions. Overall, the favorable returns, liquidity position, and active risk management appear to outweigh the manageable headwinds, supporting a constructive outlook for 2026.Positive Updates
Strong Q4 Total Economic Return
ARMOUR reported a total economic return of 10.63% for Q4, driven by MBS spread tightening, lower MBS volatility, and a lower interest rate environment.
Negative Updates
Rising Prepayment Speeds
Aggregate portfolio prepayments averaged 11.1 CPR through Q4 2025 and Q1 2026 to date, up from 8.1 CPR in Q3 2025, indicating elevated prepayment/refinance risk as mortgage rates move toward the low end of the 6%–6.3% band.
Read all updates
Q4-2025 Updates
Positive
Negative
Strong Q4 Total Economic Return
ARMOUR reported a total economic return of 10.63% for Q4, driven by MBS spread tightening, lower MBS volatility, and a lower interest rate environment.
Read all positive updates
Company Guidance
Management guided that 2026 remains supportive and that they expect a consistent, predictable return profile driven by a steeper yield curve and lower volatility, while continuing to stress-test liquidity, hedge systematically and deploy capital opportunistically; key metrics cited include a Q4 total economic return of 10.63%, GAAP net income $28.7M ($1.86/sh), net interest income $50.4M, distributable earnings $79.8M ($0.71/sh), Q4 book value $18.63 (+6.5% QoQ) with a current estimate of $18.37 as of Feb 17, monthly common dividends of $0.24 ($0.72/quarter) with Feb and Mar dividends declared, a portfolio now north of $20B (up >10% since YE 2025) driven by ~22 bps of spread tightening, net balance sheet duration of 0.14 years, implied leverage ~7.9x (ex-Treasury loans), added >$3B of MBS/DUS (including >$1B of 4.5%/5% coupons), aggregate prepayments ~11.1 CPR (vs 8.1 CPR in Q3), ~92% of assets in specified pools (nearly 30% in prepayment-protected CMBS/discounts), ~86% of hedges in OIS/SOFR swaps, financing across 23 repo counterparties with ~80% of repo principal at ≤3% haircut and a weighted average haircut ≈2.75%, repo costs ~SOFR+15 bps, liquidity ~54% of shareholders’ equity, capital raises of ~$3.8M preferred in Q4 (183k shares), ~$138M common ATM through 2/11/26 (≈7.5M shares) and ~$4.8M preferred (230k shares), and a marginal capital hurdle near 16% with levered production-coupon yields on 30-year 5s in the mid-teens (8x leverage, hedged), all supporting their confidence in delivering shareholder value in 2026.ARMOUR Residential REIT Financial Statement Overview
Summary
Income Statement
38
Negative
Balance Sheet
55
Neutral
Cash Flow
60
Neutral
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.31B | 239.90M | 449.67M | -877.95M | 4.89M |
| Gross Profit | 1.27B | 206.77M | 418.09M | -903.93M | -17.61M |
| EBITDA | 964.77M | 509.75M | 457.87M | -109.14M | 22.47M |
| Net Income | 322.69M | -14.39M | -67.92M | -229.93M | 15.36M |
Balance Sheet | |||||
| Total Assets | 21.01B | 13.55B | 12.34B | 9.44B | 5.28B |
| Cash, Cash Equivalents and Short-Term Investments | 63.27M | 67.97M | 221.89M | 87.28M | 337.66M |
| Total Debt | 17.94B | 0.00 | 0.00 | 0.00 | 0.00 |
| Total Liabilities | 18.74B | 12.19B | 11.07B | 8.32B | 4.13B |
| Stockholders Equity | 2.26B | 1.36B | 1.27B | 1.11B | 1.14B |
Cash Flow | |||||
| Free Cash Flow | 124.20M | 261.46M | 132.82M | 124.08M | 11.74M |
| Operating Cash Flow | 124.20M | 261.46M | 132.82M | 124.08M | 11.74M |
| Investing Cash Flow | -7.28B | -1.69B | -3.04B | -3.89B | 503.58M |
| Financing Cash Flow | 7.30B | 1.31B | 3.05B | 3.53B | -330.77M |
ARMOUR Residential REIT Technical Analysis
Positive
18.56
Price Trends
17.15
Positive
16.94
Positive
15.64
Positive
Market Momentum
-0.08
Negative
54.64
Neutral
92.80
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ARR, the sentiment is Positive. The current price of 18.56 is above the 20-day moving average (MA) of 16.67, above the 50-day MA of 17.15, and above the 200-day MA of 15.64, indicating a bullish trend. The MACD of -0.08 indicates Negative momentum. The RSI at 54.64 is Neutral, neither overbought nor oversold. The STOCH value of 92.80 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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 |
|---|---|---|---|---|---|---|---|
66 Neutral | $2.64B | 2.95 | 17.19% | 14.63% | 47.97% | 17.22% | |
65 Neutral | $2.17B | 12.19 | 3.79% | 4.94% | 3.15% | 1.96% | |
60 Neutral | $1.50B | 10.61 | 6.83% | 9.89% | 0.29% | ― | |
59 Neutral | $1.53B | 9.19 | 8.54% | 11.37% | 70.94% | 2.95% | |
58 Neutral | $2.07B | 2.34 | 16.65% | 15.06% | -27.55% | -97.87% | |
54 Neutral | $1.27B | 21.49 | 4.28% | 8.21% | -17.18% | -17.16% | |
53 Neutral | $1.09B | 4.43 | 8.85% | 11.40% | 9.46% | -111.44% |
* Real Estate Sector Average
ARR
ARMOUR Residential REIT
17.33
4.71
37.31%
ARI
Apollo Real Estate
10.76
3.02
38.96%
CIM
Chimera Investment
13.08
2.89
28.36%
DX
Dynex Capital
13.08
2.92
28.70%
EFC
Ellington Financial
12.30
1.56
14.57%
LADR
Ladder Capital
9.98
0.35
3.60%
ARMOUR Residential REIT Corporate Events
Business Operations and StrategyDividends
ARMOUR Residential REIT Declares April 2026 Cash Dividends
Positive
Apr 1, 2026
On March 30, 2026, ARMOUR Residential REIT, Inc. extended the base term of its external management agreement with ARMOUR Capital Management LP by 3.25 years to March 31, 2033, replacing the prior version without changing termination, extension pro...
Business Operations and StrategyDividends
ARMOUR Residential REIT Declares April 2026 Monthly Dividend
Positive
Mar 25, 2026
On March 25, 2026, ARMOUR Residential REIT, Inc. announced guidance for its April 2026 monthly cash dividend on common stock, setting the rate at $0.24 per share. The dividend will be paid on April 29, 2026 to shareholders of record as of April 15...
Business Operations and StrategyDividendsFinancial Disclosures
ARMOUR Residential REIT Issues March 2026 Portfolio Update
Positive
Mar 13, 2026
On March 13, 2026, ARMOUR Residential REIT released a March 2026 monthly update detailing its financial position, portfolio and capital structure as of late February. The company reported a $21.4 billion total investment portfolio dominated by 30-...
Business Operations and StrategyDividendsFinancial DisclosuresPrivate Placements and Financing
ARMOUR Residential REIT Highlights Strong Q4 Results, Liquidity
Positive
Feb 18, 2026
ARMOUR Residential REIT reported unaudited fourth-quarter 2025 results on February 18, 2026, posting GAAP net income available to common shareholders of $208.7 million, or $1.86 per share, and distributable earnings of $79.8 million, or $0.71 per ...
Business Operations and StrategyDividendsFinancial Disclosures
ARMOUR Residential REIT Issues February Portfolio and Dividend Update
Positive
Feb 18, 2026
On February 18, 2026, ARMOUR Residential REIT released a February 2026 monthly update detailing its mortgage‑backed securities portfolio and capital position as of January 31, 2026. The $20.98 billion portfolio remains overwhelmingly concent...
Business Operations and StrategyFinancial Disclosures
ARMOUR Residential REIT Schedules Q4 2025 Earnings Webcast
Neutral
Feb 17, 2026
ARMOUR Residential REIT, Inc. announced on February 17, 2026, that it will host an online, real-time webcast of its conference call with equity analysts to discuss operating results for the fourth quarter ended December 31, 2025. The call is sched...
Dividends
ARMOUR Residential REIT Declares March 2026 Monthly Dividend
Positive
Feb 17, 2026
On February 17, 2026, ARMOUR Residential REIT, Inc. declared a cash dividend of $0.24 per common share for the month of March 2026, reinforcing its income-distribution role for shareholders. The dividend will be paid on March 30, 2026, to stockhol...
Business Operations and StrategyDividends
ARMOUR Residential REIT Declares February 2026 Monthly Dividend
Positive
Jan 29, 2026
On January 29, 2026, ARMOUR Residential REIT, Inc. announced that it would pay a cash dividend of $0.24 per share on its common stock for the month of February 2026, with shareholders of record as of February 17, 2026 scheduled to receive payment ...
Business Operations and StrategyPrivate Placements and FinancingRegulatory Filings and Compliance
ARMOUR Residential REIT Expands ATM Equity Sales Program
Positive
Jan 28, 2026
On January 28, 2026, ARMOUR Residential REIT amended its existing at-the-market equity sales program, increasing by 15 million the number of common shares that may be offered and sold and revising its roster of sales agents, removing Janney Montgo...
Business Operations and StrategyDividendsFinancial Disclosures
ARMOUR Residential REIT Issues January 2026 Financial Update
Positive
Jan 16, 2026
On January 16, 2026, ARMOUR Residential REIT issued a January 2026 monthly update presentation detailing its financial position and portfolio data as of December 31, 2025, showing a $20.0 billion portfolio heavily concentrated in agency mortgage&#...
Dividends
ARMOUR Residential REIT Confirms January 2026 Dividend Payments
Positive
Jan 2, 2026
On January 2, 2026, ARMOUR Residential REIT, Inc. confirmed a cash dividend of $0.24 per share on its common stock for January 2026, payable on January 29, 2026 to shareholders of record as of January 15, 2026, aligning with guidance issued in lat...
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.