ABR - Arbor Realty: Growing Revenue From Higher Rates Should Mitigate CLO Risks
2024-04-24 15:11:03 ET
Summary
- Arbor Realty Trust is an mREIT that invests in different classes of real estate and has a diverse portfolio of assets.
- ABR offers a high dividend yield of 13.4% and has consistently increased its dividend payouts despite market conditions. The dividend has increased at a double digit CAGR over 10 years.
- There could be some issues with potential CLO delinquencies, but time will tell how this plays out. Higher interest revenue and loan originations may offset this.
- ABR look attractive from a valuation perspective, trading at a discounted P/E below the sector's median.
Overview
In a time of elevated interest rates and slimming odds of a cut, real estate has been beat up over the last year. Arbor Realty Trust ( ABR ) operates as an mREIT (mortgage REIT) and has also seen the impact of the environment. ABR's business is to invest in different classes of real estate, through bridge and mezzanine loans. The mREIT invests in a mixed portfolio of properties including multi-families, single family rentals, and commercial buildings. We can see that over the last 3 years, ABR has underperformed the S&P 500 ( SPY ) in total return....
Arbor Realty: Growing Revenue From Higher Rates Should Mitigate CLO Risks