Demo
AOMR NYSE· Angel Oak Mortgage REIT Inc.
FundamentalsNews digest Peer analysis
Login
AOMR NYSE· Angel Oak Mortgage REIT Inc.
Earnings report Q3 2023

Angel Oak Mortgage REIT Reports Strong Revenue Growth in Latest Quarter

Segments of Revenue

In the latest quarter, Angel Oak Mortgage REIT (AOMR) reported revenue from various segments. The company's revenue primarily comes from its investments in residential mortgage loans, residential mortgage-backed securities (RMBS), and other mortgage-related assets. Additionally, AOMR generates revenue from its wholly-owned taxable REIT subsidiary, Angel Oak Mortgage REIT TRS, LLC (AOMR TRS), which invests in Angel Oak Mortgage Fund TRS.

Strengths

AOMR demonstrated strong revenue growth in the latest quarter. The company's revenue was bolstered by its investments in non-agency RMBS, Whole Pool Agency RMBS, commercial mortgage-backed securities (CMBS), and U.S. Treasury securities. AOMR's ability to generate attractive risk-adjusted returns for its stockholders across interest rate and credit cycles has contributed to its revenue growth. Furthermore, the company's management has emphasized its commitment to delivering cash distributions and capital appreciation to its stockholders.

Challenges

While AOMR reported strong revenue growth, there may be potential challenges ahead. The company operates primarily through a wholesale channel, which could expose it to fluctuations in the mortgage market. Additionally, the performance of the residential mortgage market and the overall economy could impact AOMR's revenue in the future. It is important for the company to closely monitor these factors and adapt its strategies accordingly.

Noteworthy

AOMR's investment in AOMT 2023-5, which issued approximately $260.6 million in face value of bonds, played a significant role in the company's revenue generation. AOMR held a proportionate share of 34.42% of the retained bonds and investments in MOAs, amounting to approximately $8.7 million. The proceeds from the securitization transaction were used to repay outstanding debt and retained cash for operational purposes. This transaction resulted in the derecognition of mortgage loans sold and the recording of an investment in a majority-owned affiliate within "other assets" on AOMR's condensed consolidated balance sheet.

Summary

Angel Oak Mortgage REIT delivered strong revenue growth in the latest quarter, driven by its investments in residential mortgage loans, RMBS, and other mortgage-related assets. The company's ability to generate attractive risk-adjusted returns and its commitment to delivering cash distributions and capital appreciation have contributed to its positive financial performance. However, AOMR should remain vigilant of potential challenges, such as market fluctuations and economic conditions, that could impact its revenue in the future. The company's investment in AOMT 2023-5 also played a noteworthy role in its revenue generation.

Source documents

Form 10-Q  filed on Nov 08, 2023
11 pages scanned

Reference data

Company financials Q3 revenue 33.4M
Analyst estimates Q3 EPS missed by -∞%
Sign up to Fey

Get in-depth analysis on thousands of stocks for just $30/month. Cancel anytime.