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The growth of the EPS is critical in understanding the current valuation of ARMOUR Residential REIT. It is usually expressed as a percentage and is then referred to as the EPS growth rate, which at this time is hard to estimate, but revenue growth has been -0.90 % over the last twelve months. The higher the EPS growth rate, the higher the value that is added to shareholders and a good reflection on the performance of the management at ARMOUR Residential REIT.



ARMOUR Residential REIT is in the real estate sector and trades as part of the REITs industry. The company CEO is Jeffrey J. Zimmer / Scott J. Ulm. ARMOUR Residential REIT Inc invests in and manages a leveraged portfolio of residential mortgage backed securities. It invests in residential mortgage backed securities issued or guaranteed by a United States Government-sponsored entity.

Previous Intraday Performance:

The ARR shares had a previous change of -0.09% which opened at 22.16 and closed at 22.14. It moved to an intraday high of 22.23 and a low of 21.91.

SeekingAlpha:  Mortgage REITs log in a good day

Historical Performance:

Over the last five trading days, ARR shares returned 1.42% and in the past 30 trading days it returned 7.97%. Over three months, it changed -3.64%. In one year it has changed -3.13% and within that year its 52-week high was 26.50 and its 52-week low was 20.15. ARR stock is 9.88% above its 52 Week Low.

Our calculations result in a 200 day moving average of 21.89 and a 50 day moving average of 21.65. Right now, ARR stock is trading 1.12% above its 200 day moving average and may be a good opportunity to buy.

SeekingAlpha:  Mortgage REITs log in a good day

Liquidity:

The company has a market cap of $937.3m with 42.3m shares outstanding and a float of 41.7m shares. Trading volume was 436,015 shares and has experienced an average volume of 576,041 shares. Our calculation, using the current average volume and close price, leads me to believe that the liquidity is bad, highly speculative and an investor may want to avoid this stock.

Earnings:

The last annual reported EPS for ARMOUR Residential REIT was 4.21 which ended on 31st of December 2017, which according to the previous close, that is a PE of 5.26. The trailing twelve month EPS is 1.95, which comes to a trailing twelve month PE of 11.35.

Below was the last reported quarterly earnings per share:
09-30-2018:  0.64
06-30-2018:  0.65
03-31-2018:  0.66
12-31-2017:  0

The dividend per share is currently 2.28, which is a dividend yield of 10.30%.



Base on our calculations, the intrinsic value per share is 39.54, which means it might be undervalued and has a margin of safety of 44.01%

Indicators Also to Watch:

Based on the latest filings, there is 1.60% of insider ownership and 95.30% of institutional ownership. Short-interest was 5,508,244, which was 13.01% of shares outstanding. The short-interest ratio or days-to-cover ratio was 9.00. This stock has a moderate level of short interest, but may still be a buying opportunity depending on other indicators.

I calculated the beta to be 0.65

SeekingAlpha:  Tracking Wallace Weitz’s Weitz Investment Management Portfolio – Q3 2018 Update

Fundamental Numbers:

Based on last reported financials, the company’s return on equity is 12.70%, return on assets is 1.86%, profit margin is 64.22%, price-to-sales is 3.40 and price-to-book is 0.78.

Company Score Card:

Results are out of six:
 0  : Growth Expectations Result
 2  : Financial Safety Result
 1  : Past Performance Result
 5  : Valuation Result
 3  : Dividend Safety Result
 2  : Overall Result

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Jake McWilliams
I am an independent trader, analyst and algorithmic trading expert, having worked both for the sell side (brokerage) and the buy side (fund administration). I have been trading professionally for about 20 years. I trade stocks and forex and I play both long and short positions in underlying asset or through options. I have experience with discretionary and fully automated systems (Metatrader and Quantshare).

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