Angel Oak Mortgage REIT's Book Value Decline Widens

The Tip Desk · November 3, 2026 · 3 min read

GAAP book value fell to $8.97 a share in the third quarter as a $16.7 million net loss followed a $3.4 million profit.

Angel Oak Mortgage REIT, Inc. (AOMR), a real estate finance company focused on first and second lien non-QM loans, reported a GAAP net loss of $16.7 million, or $0.72 a share, for the quarter ended September 30, 2026, after net income of $3.4 million, or $0.14 a share, in the second quarter.

The swing followed a $22.6 million net unrealized loss on mortgage loans, a portion of debt at fair value option, derivative contracts and trading securities, versus an $11.3 million unrealized gain a year earlier. Net realized gain on mortgage loans, derivative contracts, RMBS and CMBS was $1.8 million.

Net interest income was $10.2 million, a 55 basis-point increase versus the third quarter of 2025. Interest income was $42.5 million and interest expense $32.2 million. Distributable Earnings, a non-GAAP measure that excludes unrealized gains and losses, impairment, debt extinguishment and other items, were $6.4 million, or $0.28 a share, compared with $9.0 million, or $0.37 a share, in the second quarter.

Chief Executive Officer and President Sreeni Prabhu said the company completed two securitizations early in the period, ahead of the bulk of the increase in rates, and that the higher-rate environment created near-term pressure on portfolio valuations and what the company described as a short-term squeeze on potential returns on new investments. The company said it remains confident in the underlying credit performance of the portfolio and continues to deploy capital selectively.

GAAP book value was $8.97 a share and economic book value $11.45 a share, down 11.5% and 6.5% from the second quarter, versus 1.7% and 0.3% declines in the prior quarter. Total stockholders’ equity was $209.8 million. The company declared a $0.32 a share common dividend, unchanged from the prior quarter’s declaration, payable November 30, 2026, to holders of record November 23, 2026.

During the quarter the company purchased $233 million of newly originated, current-market-coupon non-QM residential mortgage loans and HELOCs, with a weighted average coupon of 7.29%, weighted average CLTV of 69.8% and non-zero weighted average credit score of 758. As of September 30, 2026, the weighted average coupon of the residential whole loans portfolio was 7.21%, a 17 basis-point decrease versus December 31, 2025, after a 13 basis-point increase at June 30.

Target assets totaled $2.8 billion. Residential mortgage whole loans awaiting securitization had a fair value of $303.7 million, down from $438.8 million at June 30. The company was a party to four loan financing lines permitting borrowings of up to $1.3 billion, of which about $255 million was drawn, leaving about $1 billion of capacity. Recourse debt to equity was 2X at September 30, versus 2.3x at June 30, and decreased to about 1.2X following the AOMT 2026-6 securitization in October 2026.

For the nine months ended September 30, 2026, net interest income was $33.1 million, up 9.5% from the year-earlier nine months.