NYMTZ - New York Mortgage Trust: The Series G Preferred Shares Are A Turnaround Bet
2024-07-20 05:30:53 ET
Summary
- New York Mortgage Trust is a mREIT focused on agency residential mortgage-backed securities but also holds a 15% pure real estate exposure to multifamily.
- The Series G 7% fixed-rate preferred shares have significantly outperformed the iShares Preferred and Income Securities ETF in 2024.
- I expect the outperformance to continue thanks to a solid current yield and ample capital gain potential if operational performance stabilizes.
- The company delivered a net loss in Q1 2024, but I foresee some of the driving factors to reverse as the Fed cuts rates.
- The key risk to consider is the poor coverage of preferred dividends by net income ever since the Fed started raising rates in 2022.
Introduction
New York Mortgage Trust's Series G 7% fixed-rate preferred shares ( NYMTZ ) have significantly outperformed the iShares Preferred and Income Securities ETF ( PFF ) so far in 2024, delivering a 15% total return against the mid-single-digit gain for the benchmark ETF:
New York Mortgage Trust Series G preferred shares vs PFF in 2024 (Seeking Alpha)
