Angel Oak Mortgage REIT, Inc. (AOMR) - Q1 2026 Filing Summary
Business Context and Reporting Period
This summary covers the Form 10-Q for the quarterly period ended March 31, 2026. Angel Oak Mortgage REIT, Inc. is a real estate finance company focused on acquiring and investing in first and second lien non-qualified residential mortgage (non-QM) loans and other mortgage-related assets. The Company is externally managed by Falcons I, LLC and operates as a taxable REIT subsidiary structure. As of May 5, 2026, there were 24,914,647 shares of common stock outstanding.
Key Financial Metrics
| Metric | Q1 2026 | Q1 2025 |
|---|---|---|
| Net Interest Income | $12.11 million | $10.09 million |
| Net Income (Loss) | $(7.38) million | $20.53 million |
| Distributable Earnings (Non-GAAP) | $4.64 million | $4.14 million |
| EPS (Basic & Diluted) | $(0.30) | $0.88 |
| Total Assets | $2.81 billion | $2.75 billion |
| Total Liabilities | $2.55 billion | $2.48 billion |
| Stockholders' Equity | $256.90 million | $267.52 million |
| Cash and Cash Equivalents | $41.96 million | $41.62 million |
| Net Cash Used in Operating Activities | $(143.72) million | $(201.75) million |
Material Changes vs. Prior Period
- Net Income Decline: The Company reported a net loss of $7.38 million compared to net income of $20.53 million in Q1 2025. This reversal was primarily driven by a $14.31 million net realized and unrealized loss, contrasting with a $13.44 million gain in the prior year.
- Unrealized Losses: Net unrealized losses totaled $11.59 million, attributed to valuation decreases in residential loans in securitization trusts and the residential whole loan portfolio, partially offset by gains on derivatives.
- Net Interest Income Growth: Net interest income increased by 20% ($2.03 million) year-over-year, driven by a $7.8 million increase in interest income due to a larger asset base, which outpaced a $5.8 million increase in interest expense.
- Portfolio Composition: Residential mortgage loans in securitization trusts increased to $2.25 billion (from $2.08 billion), while direct residential mortgage loans decreased to $245.5 million (from $294.1 million). RMBS holdings decreased to $212.6 million (from $280.0 million).
- Dividends: The Company paid dividends of $0.32 per share in Q1 2026, consistent with Q1 2025.
Guidance, Outlook, and Risks
- Market Environment: Management notes a stable but data-dependent interest rate environment with the Federal Reserve maintaining rates at 3.50% - 3.75%. Securitization markets remain active with constructive execution spreads.
- Strategic Activity: In March 2026, the Company executed a $272.3 million securitization (AOMT 2026-2), using proceeds to repay debt and fund new loan purchases. The Company expects to continue acquiring newly originated loans throughout 2026.
- Financing: Total borrowing capacity under warehouse lines is $1.25 billion, with $1.06 billion available as of March 31, 2026. The Company maintains compliance with all financial covenants.
- Risks: Key risks include interest rate volatility, credit performance of non-QM loans, prepayment speeds, and the ability to refinance or securitize assets on favorable terms. The Company utilizes interest rate futures and TBA securities to hedge interest rate risk.
- Subsequent Events: On May 5, 2026, the Company declared a dividend of $0.32 per share payable on May 29, 2026.
Investor Verification Checklist
- Unrealized Loss Drivers: Verify the specific valuation adjustments applied to the securitization trusts and whole loan portfolios that resulted in the $11.6 million unrealized loss.
- Securitization Execution: Confirm the timing and terms of future securitization deals to ensure the Company can continue to recycle capital from warehouse lines to long-term fixed-rate debt.
- Delinquency Trends: Monitor the 90+ day delinquency rate, which stood at 1.9% for loans in securitization trusts and 1.1% for direct loans as of March 31, 2026.
- Liquidity Covenants: Review the minimum tangible net worth and liquidity covenants ($10 million minimum liquidity) to ensure continued compliance given the volatility in asset valuations.
- Broker Settlements: Note the $129.4 million "Due to Broker" liability related to unsettled Whole Pool Agency RMBS trades, which settled in April 2026.