8-K: Angel Oak Mortgage REIT Reports Q1 2026 Results

Angel Oak Mortgage REIT, Inc. announced its first quarter 2026 financial results, reporting a net loss of $7.4 million but an increase in net interest income.

Summary

• Angel Oak Mortgage REIT, Inc. reported a GAAP net loss of $7.4 million, or $0.30 per diluted share, for the quarter ended March 31, 2026.
• Net interest income for Q1 2026 was $12.1 million, an increase of 20.1% compared to Q1 2025 and 11.2% compared to Q4 2025.
• GAAP book value per share was $10.31 and economic book value per share was $12.28 as of March 31, 2026, representing decreases of 4.0% and 3.3% respectively from the end of 2025.
• Distributable earnings for Q1 2026 were $4.6 million, or $0.18 per diluted share.
• The company declared a dividend of $0.32 per common share, payable on May 29, 2026.
• In March 2026, the company executed a $272.3 million securitization (AOMT 2026-2), reducing debt by $234.1 million and releasing $23.9 million in cash.
• The company purchased $246.2 million of new non-QM loans with a weighted average coupon of 7.34% during the quarter.
• As of March 31, 2026, target assets totaled $2.7 billion.

Sentiment

Score: 5

Explanation: StockSavvy.ai views this as a neutral to slightly negative sentiment, with operational positives in net interest income and securitization activity offset by a GAAP net loss and declining book value.

Positives

• Net interest income increased by 20.1% year-over-year to $12.1 million and by 11.2% quarter-over-quarter to $12.1 million.
• Successfully executed a $272.3 million securitization in March 2026, taking advantage of favorable market conditions.
• Purchased $246.2 million of newly-originated non-QM loans with a weighted average coupon of 7.34% and a CLTV of 67.1%.
• The weighted average coupon of the residential whole loans portfolio increased to 7.62%.

Negatives

• Reported a GAAP net loss of $7.4 million for the quarter.
• GAAP book value per share decreased by 4.0% to $10.31 and economic book value per share decreased by 3.3% to $12.28 from the end of 2025.
• The weighted average 90+ day delinquency rate across portfolios increased to 2.68% as of March 31, 2026, up from 2.18% at the end of 2025.

Risks

• The filing notes risks related to adverse conditions in financial markets and the economy affecting the ability to acquire assets.
• Volatility in interest rates and credit spreads is a significant risk factor.
• Changes in the company's industry, inflation, interest rates, business strategies, and the debt or equity markets pose risks.
• General market volatility and changes in the availability of attractive loans, including non-QM loans, are identified risks.
• The ability of the Manager to locate suitable investments and manage the portfolio is a risk.
• Risks associated with obtaining and maintaining financing arrangements on favorable terms.
• Potential for increased rates of default and/or decreased recovery rates on investments.
• Geopolitical events and changes in governmental regulations and tax laws are listed as potential risks.

Future Outlook

The company will continue to focus on disciplined credit, expanding earnings, and consistent securitization market activity. Management aims to make key decisions in the best long-term interest of shareholders, targeting approximately one securitization per quarter to lock in funding and provide capital for loan purchases.

Management Comments

• "The first quarter showcased our earnings engine in a variable macro environment, marking approximately 20% net interest income growth compared to the first quarter of 2025 and over 11% net interest income growth compared to the fourth quarter of 2025."
• "In early March, we executed a $272 million securitization, taking advantage of favorable market conditions prior to spread-widening associated with the onset of geopolitical conflict in the Middle East and underscoring the benefits of our methodical, repeatable approach."
• "Looking ahead, we will continue to focus on what we can control, maintaining disciplined credit, expanding earnings, and consistent securitization market activity."

Industry Context

StockSavvy.ai notes that Angel Oak Mortgage REIT's focus on non-QM loans positions it within a growing segment of the mortgage market, but also exposes it to risks associated with market volatility and credit quality. The company's strategy of securitization to secure term financing and reinvest in loans is a common approach in the REIT sector, aiming to balance leverage and returns.

Comparison to Industry Standards

• The company's net interest income growth of 20.1% year-over-year and 11.2% quarter-over-quarter appears strong relative to a potentially challenging macro environment for mortgage REITs.
• The GAAP net loss of $7.4 million and decrease in book value per share are headwinds that many mortgage REITs have faced due to interest rate volatility and unrealized valuation changes.
• The weighted average coupon on new loan purchases (7.34%) and the overall portfolio (7.62%) are competitive within the non-QM space, reflecting the higher yields available in this segment compared to traditional prime mortgages.

Related Party Transactions

• Operating expenses incurred with affiliate: $565,000 in Q1 2026.
• Management fee incurred with affiliate: $1,129,000 in Q1 2026.
• Accrued expenses payable to affiliate: $244,000 as of March 31, 2026.
• Management fee payable to affiliate: $1,161,000 as of March 31, 2026.

Stakeholder Impact

• Shareholders: Dividend declared ($0.32 per share), but book value per share has decreased.
• Creditors: Recourse debt to equity ratio was 1.3x as of March 31, 2026, with an expectation to remain below 2.5x.
• Suppliers/Service Providers: Continued engagement with affiliates for management and operational expenses.

Next Steps

• Continue to focus on disciplined credit.
• Expand earnings.
• Maintain consistent securitization market activity.
• Target approximately one securitization per quarter.
• Provide capital for additional loan purchases.
• Declare quarterly dividends balancing shareholder income and long-term book value appreciation.
• Effectively identify, assess, and act upon key opportunities and risks in appropriate markets.

Key Dates

Recommendation

The company shows operational strength with growing net interest income and successful securitization activity. However, the GAAP net loss and declining book value, coupled with increased delinquency rates, warrant a cautious approach. A 'hold' recommendation reflects the balance between positive operational execution and the negative impact of market valuations and credit metrics.

Keywords

Angel Oak Mortgage REIT, AOMR, Non-QM Loans, Securitization, Mortgage-Related Assets, Real Estate Finance, Net Interest Income, Book Value