Armour Residential Profitability Analysis

ARR
 Stock
  

USD 7.73  0.01  0.13%   

For Armour Residential profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Armour Residential to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Armour Residential R utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Armour Residential's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Armour Residential R over time as well as its relative position and ranking within its peers. Please continue to Trending Equities.
  
As of 08/11/2022, Price to Sales Ratio is likely to grow to 15.92. Also, Return on Sales is likely to grow to 0.33. Armour Residential Consolidated Income is relatively stable at the moment as compared to the past year. Armour Residential reported last year Consolidated Income of 15.36 Million. As of 08/11/2022, Net Income is likely to grow to about 16.6 M, while Income Tax Expense is likely to drop (9.2 K).

Armour Residential Revenues

54.25 Million

Is Armour Residential's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Armour Residential. If investors know Armour will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Armour Residential listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth YOY
-0.58
Market Capitalization
877 M
Quarterly Revenue Growth YOY
-0.34
Return On Assets
-0.016
Return On Equity
-0.11
The market value of Armour Residential is measured differently than its book value, which is the value of Armour that is recorded on the company's balance sheet. Investors also form their own opinion of Armour Residential's value that differs from its market value or its book value, called intrinsic value, which is Armour Residential's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Armour Residential's market value can be influenced by many factors that don't directly affect Armour Residential's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Armour Residential's value and its price as these two are different measures arrived at by different means. Investors typically determine Armour Residential value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Armour Residential's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.

Armour Residential Current Valuation vs. Debt to Equity Fundamental Analysis

Comparative valuation techniques use various fundamental indicators to help in determining Armour Residential's current stock value. Our valuation model uses many indicators to compare Armour Residential value to that of its competitors to determine the firm's financial worth.
Armour Residential R is number one stock in debt to equity category among related companies. It is the top company in current valuation category among related companies reporting about  26,683,614  of Current Valuation per Debt to Equity. . Comparative valuation analysis is a catch-all model that can be used if you cannot value Armour Residential by discounting back its dividends or cash flows. This model doesn't attempt to find an intrinsic value for Armour Residential's Stock . Still, instead, it compares the stock's price multiples to a benchmark or nearest competition to determine if the stock is relatively undervalued or overvalued. The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the Armour Residential's earnings, one of the primary drivers of an investment's value.

Armour Current Valuation vs. Debt to Equity

Debt to Equity is calculated by dividing the Total Debt of a company by its Equity. If the debt exceeds equity of a company, then the creditors have more stakes in a firm than the stockholders. In other words, Debt to Equity ratio provides analysts with insights about composition of both equity and debt, and its influence on the valuation of the company.
Armour Residential 
D/E 
 = 
Total Debt 
Total Equity 
6.88 %
High Debt to Equity ratio typically indicates that a firm has been borrowing aggressively to finance its growth and as a result may experience a burden of additional interest expense. This may reduce earnings or future growth. On the other hand a small D/E ratio may indicate that a company is not taking enough advantage from financial leverage. Debt to Equity ratio measures how the company is leveraging borrowing against the capital invested by the owners.
Enterprise Value is a firm valuation proxy that approximates the current market value of a company. It is typically used to determine the takeover or merger price of a firm. Unlike Market Cap, this measure takes into account the entire liquid asset, outstanding debt, and exotic equity instruments that the company has on its balance sheet. When a takeover occurs, the parent company will have to assume the target company's liabilities but will take possession of all cash and cash equivalents.
Armour Residential 
Enterprise Value 
 = 
Market Cap + Debt 
-  
Cash 
183.69 M
Enterprise Value can be a useful tool to compare companies with different capital structures. Long term liability and current cash or cash equivalents can have a huge impact on market valuation of a given company.

Armour Current Valuation vs Competition

Armour Residential R is the top company in current valuation category among related companies. After adjusting for long-term liabilities, total market size of REIT—Mortgage industry is presently estimated at about 2.73 Trillion. Armour Residential adds roughly 183.69 Million in current valuation claiming only tiny portion of equities listed under REIT—Mortgage industry.

Armour Residential Profitability Projections

The most important aspect of a successful company is its ability to generate a profit. For investors in Armour Residential, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Armour Residential will eventually generate negative long term returns. The profitability progress is the general direction of Armour Residential's change in net profit over the period of time. It can combine multiple indicators of Armour Residential, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
Last ReportedProjected for 2022
Accumulated Other Comprehensive Income107 M90.7 M
Consolidated Income15.4 M16.6 M
Net Income15.4 M16.6 M
Net Income Common Stock3.9 M4.2 M
Operating Income15.4 M16.6 M
Preferred Dividends Income Statement Impact11.5 M13.7 M
Income Tax Expense-9 K-9.2 K
Net Income Per Employee-1.9 M-2 M
ARMOUR Residential REIT, Inc. invests in residential mortgage-backed securities in the United States. ARMOUR Residential REIT, Inc. was incorporated in 2008 and is based in Vero Beach, Florida. Armour Residential operates under REITMortgage classification in the United States and is traded on New York Stock Exchange.

Armour Profitability Driver Comparison

Profitability drivers are factors that can directly affect your investment outlook on Armour Residential. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Armour Residential position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Armour Residential's important profitability drivers and their relationship over time.

Armour Residential Profitability Trends

Armour Residential profitability trend refers to the progression of profit or loss within a business. An upward trend means that Armour Residential's profit has generally increased over time, and a downward profitability trend means profits are declining. Recognizing problems early in profitability trends allows investors to address revenue and cost issues in advance. Investors and analysts usually monitor three types of profitability trends: gross, operating, and net. Gross profit is the difference between revenue and costs of goods sold. Operating profit is Armour Residential's gross profit minus its overhead. After you account for other unusual revenue, expenses, and costs, you get net profit. Gross profit trends are often a good indicator of future profitability. If you have high gross profit margins, you have a better chance to cover overhead and make money.

Armour Residential Profitability Drivers Correlations

One of the toughest challenges investors face today is learning how to quickly synthesize and read into endless financial statements and information provided by the company, SEC reporting, and various external parties. Understanding the correlation between Armour Residential different financial indicators related to revenue and profit generation helps investors identify and prioritize their investing strategies towards Armour Residential in a much-optimized way. Analyzing correlations between profit drivers that are directly associated with dollar figures is the most effective way to break down Armour Residential's future profitability.

Use Armour Residential in pair-trading

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Armour Residential position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Armour Residential will appreciate offsetting losses from the drop in the long position's value.

Armour Residential Pair Trading

Armour Residential R Pair Trading Analysis

The ability to find closely correlated positions to Armour Residential could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Armour Residential when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Armour Residential - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Armour Residential R to buy it.
The correlation of Armour Residential is a statistical measure of how it moves in relation to other equities. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Armour Residential moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Armour Residential moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Armour Residential can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Pair CorrelationCorrelation Matching

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Please continue to Trending Equities. Note that the Armour Residential information on this page should be used as a complementary analysis to other Armour Residential's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Insider Screener module to find insiders across different sectors to evaluate their impact on performance.

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When running Armour Residential price analysis, check to measure Armour Residential's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Armour Residential is operating at the current time. Most of Armour Residential's value examination focuses on studying past and present price action to predict the probability of Armour Residential's future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move Armour Residential's price. Additionally, you may evaluate how the addition of Armour Residential to your portfolios can decrease your overall portfolio volatility.
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To fully project Armour Residential's future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of Armour Residential at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements. These documents include Armour Residential's income statement, its balance sheet, and the statement of cash flows.
Potential Armour Residential investors and stakeholders can use historical trends found within financial statements to determine how well the company is positioned for the future. Although Armour Residential investors may work on each financial statement separately, they are all related. The changes in Armour Residential's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on Armour Residential's income statement, which results in the company's gains or losses. Cash flows can provide more information regarding cash listed on a balance sheet but not equivalent to net income shown on the income statement. Please read more on our technical analysis and fundamental analysis pages.