15.5% Dividends?

Is this for real? [View in browser]( [The Spill Logo] BROUGHT TO YOU BY: [Logo]( Proprietary Data Insights Financial Pros’ Top Mortgage REIT Searches in the Last Month Rank Name Searches #1 AGNC Investment 125 #2 Arbor Realty Trust 63 #3 Blackstone Mortgage Trust Class A 50 #4 MFA Financial 44 #5 Starwood Property Trust 28 #ad [Sell every stock except ONE]( Brought to you by [Datalign Advisory]( [Match With a Financial Advisor in Minutes]( [Datalign Advisory - Match With a Financial Advisor in Minutes]( How confident are you in your long-term financial plan? Datalign Advisory is a free service that can help you with your retirement goals. Advisors in our network can help put you in control of your financial plan today. [Click here to get started](. 15.5% Dividends? We can’t think of anything more precarious than trying to pick the bottom in the bond market. After all, the Fed hasn’t said it plans to stop raising rates. But a looming recession and regional banking trouble could force its hand. Should that happen, mortgage real estate investment trusts (REITs) could benefit handsomely. No joke, the average dividend yield among financial pros’ top five mortgage REIT stock searches, according to our Trackstar database, is north of 14%. That might be more stable than it sounds. So today, out of the top five searches, we’re focusing on the one with the best valuation metrics and debt profile: Arbor Realty Trust (ABR). Arbor Realty Trust’s Business REITs are special entities that don’t pay corporate taxes so long as they pass along 90%+ of their profits to shareholders. That’s why they pay juicy dividends. Many of these companies borrow heavily to employ leverage. Arbor is different from most mortgage REITs that typically own just a bunch of mortgage-backed securities. It provides loans and origination services to multifamily and single-family rental portfolios as well as other diverse commercial real estate assets, giving it multiple revenue streams. [Product lines] Source: Arbor Realty Trust The company’s mixed portfolio balances across multiple product lines, including holding multifamily loans on its books or servicing Fannie Mae loans. Note that a short-selling outfit called “NINGI Research” published a hit piece on Arbor. But its claims are without merit and lack a fundamental understanding of Arbor’s business model. A good example of why this hit piece is misguided: It claims Arbor’s loans vanished from its balance sheet overnight. They didn’t. They simply converted from one loan to another. As many companies have done, ABR took bridge loans, short-term debt, and moved them to agency loans, mortgages on multifamily properties backed by Fannie or Freddie. Financials [Growth] Source: Stock Analysis Arbor’s done a fantastic job steadily increasing revenues, boasting double-digit YoY growth most of the last decade. Plus, it’s improved operating and profit margins as well as free cash flow over that same period. Last quarter, Arbor reported $14.3 billion in loans and lease receivables, a massive increase over its $4.0 billion in 2019. It carries $13.5 billion in debt obligations. Valuation [Sales] Source: Seeking Alpha Typical valuation measures aren’t as meaningful. Price-to-book ratio can signify what a stock’s price assumes loans or underlying assets are worth. Currently, all the REITs we compared trade below 1.0x on this measure, meaning they’re at a discount to fair value. Although Arbor’s price-to-book isn’t the lowest, it’s pretty cheap. Plus, it trades at one of the deepest price-to-cash-flow discounts. Dividend Yield [Revenue] Source: Seeking Alpha Investors buy REITs for the income they produce. ABR has the most years of consecutive dividend growth as well as solid three- and five-year average annual dividend growth. It currently yields 15.5%. Debt & Cash [Balance sheets] Source: Seeking Alpha A REIT’s ability to pay its shareholders is a function of its debt and credit risk management. All the companies we compared have similar total debt-to-equity ratios. But we like ABR’s lower net debt. And ABR produces the best operating cash flow. [Bite into this $300 Billion Food Industry - Offer ends tomorrow]( There’s a growing demand for food on the go. Enter Blendid, the maker of compact, robotic smoothie kiosks that operate 24/7 and allow brands to make more money while scaling to high-traffic locations like malls, colleges and airports. Blendid has 500+ contracts with national brands to help them expand their reach while boosting profit margins. And they’re seeking investors to help expand the kiosk’s cuisine options, making higher profits possible for more brands in up to 70K+ locations. [Get your shares of Blendid. Opportunity ends soon]([Ad] Our Opinion 10/10 Arbor Realty Trust consistently delivers stellar growth with a diversified portfolio. Even with higher interest rates, it keeps its average maturity at around 20 months, meaning any poor results won’t last long. We like ABR as a long-term hold so long as management keeps up its performance. 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Copyright ©2023 InvestingChannel. All rights reserved. 1325 Avenue of the Americas, Floor 27 & 28 New York, New York 10019 Disclaimer: This is not investment advice. This InvestingChannel, Inc., newsletter is for information purposes only and is based on opinion. Futures, forex, stock, and options trading are not appropriate for all investors. There is a substantial risk of loss associated with trading these markets. Losses can and will occur. No system or methodology has ever been developed that can ensure returns or eliminate losses. InvestingChannel, Inc., makes no representation or implication that using any of the methodologies or systems in this newsletter will generate returns or insure against losses. Investors should be cautious about any and all investments and are advised to conduct their own due diligence prior to making any investment decisions.