Armour Residential REIT: Navigating High Leverage and Book Value Pressures

Armour Residential REIT finds itself at a critical juncture, balancing its appeal to income investors with significant financial challenges. The mortgage real estate investment trust’s recent quarterly results and capital market activities highlight the complexities of operating with substantial leverage in a volatile interest rate environment.

For the second quarter of 2025, Armour Residential REIT presented investors with contrasting financial pictures. The company reported a GAAP net loss of $78.6 million, equivalent to $0.94 per share. However, the more closely-watched metric of distributable earnings per share came in at $0.77, representing $64.9 million in total. This figure fell short of market expectations, despite the company generating $33.1 million in net interest income.

More concerning to analysts was the decline in book value... Read more...