Breaking Down New York Mortgage Trust, Inc. (NYMT) Financial Health: Key Insights for Investors

You're looking at New York Mortgage Trust, Inc. (NYMT) and trying to reconcile that eye-popping dividend yield with the recent earnings volatility, and honestly, you should be. The first half of the 2025 fiscal year was a study in contrasts for this mortgage real estate investment trust (mREIT): Q1 brought a strong net income of $30.3 million, or $0.33 per share, but Q2 flipped to a GAAP net loss of ($3.5 million), or ($0.04) per share, which is a significant swing. Still, the underlying story is in the non-GAAP figures, where Earnings Available for Distribution (EAD) per share actually increased to $0.22 in Q2, helping to cover the consistent quarterly dividend of $0.20 per share, and keeping the forward dividend yield near 11.25% as of mid-November 2025. The core risk is clear-the book value per share slipped from $9.37 to $9.11 between Q1 and Q2-but the opportunity lies in their aggressive asset acquisition, exceeding $2.8 billion in 2025 to date, and the improved net interest spread, which widened to 1.50% in Q2. Let's dig into what this means for the sustainability of that yield and the near-term capital preservation strategy.

Revenue Analysis

You need to know where New York Mortgage Trust, Inc. (NYMT)'s money is coming from to gauge the quality of its earnings. The core of its revenue, like any mortgage real estate investment trust (REIT), is Net Interest Income-the spread between what it earns on its mortgage assets and what it pays on its funding. For the first half of 2025, the picture is one of aggressive growth but also volatility.

The company's investment portfolio, which reached $8.6 billion in Q2 2025, is the engine. Total adjusted interest income, a key metric of recurring revenue, rose to $132.5 million in the second quarter, an 8% increase from the prior quarter. That's a solid quarter-over-quarter bump. Still, the GAAP revenue numbers are a bit of a rollercoaster, which is typical in this sector due to the mark-to-market accounting on their assets and hedges.

Looking at year-over-year performance, the growth is striking. In Q1 2025, New York Mortgage Trust, Inc. (NYMT) reported revenue of $78.1 million, a massive jump of 168% compared to Q1 2024. The second quarter maintained strong growth, with revenue of $45.1 million, representing a 40% increase from Q2 2024. That kind of triple-digit and high double-digit growth tells you management is executing on its repositioning strategy, but you must remember that the prior year was a low base.

Here's the quick math: the adjusted net interest income per share, a cleaner view of core earnings, was up 47% year-over-year in Q2 2025. That's a clear sign of enhanced portfolio earnings power.

The revenue streams break down based on their asset allocation, which is how they deploy capital to generate interest income. It's a diversified mix of residential and multi-family mortgage-related assets, a strategy designed to balance risk and yield. As of Q2 2025, the capital was allocated as follows:

• Single-Family Credit/Other: 44%
• Multi-Family investments: 38%
• Single-Family Agency (Agency RMBS): 18%

The Single-Family Credit segment is heavily weighted toward Business Purpose Loans (BPLs), which are loans to real estate investors, not owner-occupiers. This is where the higher yields-and higher credit risk-live. The Agency RMBS portion provides liquidity and a lower-risk profile, even if the yields are thinner. You can read more about their strategic focus in their Mission Statement, Vision, & Core Values of New York Mortgage Trust, Inc. (NYMT).

A major change in the revenue structure is the full acquisition of Constructive Loans, LLC in July 2025. Constructive is a leading originator of BPLs. This move is huge because it vertically integrates the business: New York Mortgage Trust, Inc. (NYMT) now owns the origination pipeline for its highest-yielding asset class. This acquisition is defintely a long-term play for consistent, recurring interest income, but it comes with a near-term cost, as management expects the general and administrative (G&A) expense ratio to increase from 3.4% to the range of approximately 6.2% to 6.4%.

What this estimate hides is the potential for much stronger BPL origination volume, which hit over $5.1 billion in the first half of 2025, driven by Constructive. This is a clear shift toward controlling the supply of their most profitable assets.

Profitability Metrics

You're looking at New York Mortgage Trust, Inc. (NYMT) and trying to figure out if their profitability is real or just a market mirage. The direct takeaway is that while the company posted a GAAP net loss in the second quarter of 2025, the core operating metric-Net Interest Spread-is improving, which is what matters most for a mortgage real estate investment trust (mREIT).

Gross, Operating, and Net Profit Margins

For an mREIT like New York Mortgage Trust, Inc., we have to translate the traditional profitability terms into the language of interest-rate arbitrage. Think of Net Interest Income (NII) as your Gross Profit. It's the difference between the interest they earn on their assets (mortgage-backed securities and loans) and the interest they pay on their funding (repurchase agreements and debt). The company reported NII of $36.447 million in the second quarter of 2025.

The true measure of operating efficiency is the Net Interest Spread, which is essentially their operating profit margin. This spread is the difference between the yield on their average interest-earning assets and the cost of their average borrowings. For Q2 2025, this spread was 1.50%. Here's the quick math on the implied NII Margin (NII divided by Interest Income) for Q2 2025: $36.447 million NII divided by $140.901 million in Interest Income gives you a margin of roughly 25.87%.

On the bottom line, the GAAP Net Profit (or loss) can be misleading due to non-cash items like changes in the fair value of derivatives. For Q2 2025, New York Mortgage Trust, Inc. reported a GAAP net loss attributable to common stockholders of ($3.486 million). But you should focus on Earnings Available for Distribution (EAD), which is the cash flow that covers the dividend. EAD for Q2 2025 was $20.024 million, or $0.22 per share, which is a much cleaner view of their actual distributable profit.

Profitability Trends and Operational Efficiency

The trend is defintely moving in the right direction, which is a critical signal in this volatile rate environment. The Net Interest Spread increased from 1.32% in Q1 2025 to 1.50% in Q2 2025. That's a solid quarter-over-quarter gain, and it shows their portfolio management is working. The company is actively deploying capital into higher-yielding assets like Agency Residential Mortgage-Backed Securities (RMBS) and business purpose loans (BPLs), which is enhancing portfolio earnings.

Operational efficiency is also improving. Management has been focused on reducing General and Administrative expenses and implementing other operational efficiencies. This cost management, coupled with the rising Net Interest Spread, drove the Earnings Available for Distribution (EAD) per share up by 10% quarter-over-quarter, from $0.20 in Q1 2025 to $0.22 in Q2 2025.

• Net Interest Spread rose 18 basis points (bps) Q/Q.
• EAD per share grew 10% Q/Q.
• Portfolio expanded to $8.6 billion in Q2 2025.

Industry Comparison and Outlook

New York Mortgage Trust, Inc.'s profitability ratios, particularly the 1.50% Net Interest Spread, should be viewed against the backdrop of the broader mREIT market, which is still navigating a challenging, albeit improving, environment. The wider market spread between the 30-year mortgage rate and the two-year Treasury was hovering around 3.0% as of early September 2025, indicating a healthier investing environment for the sector. New York Mortgage Trust, Inc.'s ability to widen its own spread is a positive sign of internal execution.

While direct peer-to-peer Net Interest Spread averages are hard to pin down, the overall commercial mREIT sector is trading at an average dividend yield of approximately 10.5% and a price-to-book value of 0.75 times. New York Mortgage Trust, Inc. is trading at a significant discount to its adjusted book value of $10.26 per share as of Q2 2025, which suggests the market is pricing in risk but also offers potential upside if profitability continues to stabilize. Analysts project full-year 2025 sales (revenue) of $152.16 million and Earnings Per Share (EPS) of $1.063, which would mark a substantial improvement over the prior year. If you want to dig deeper into who is betting on this turnaround, you can check out Exploring New York Mortgage Trust, Inc. (NYMT) Investor Profile: Who's Buying and Why?

The key action here is to monitor the Q3 2025 results-analysts are projecting revenue of $42.72 million-to see if the Net Interest Spread continues its upward trajectory. If it does, the stock's discount to book value becomes increasingly compelling. Management: Track NII and Net Interest Spread for Q3 2025 against the 1.50% Q2 baseline.

Debt vs. Equity Structure

You're looking at New York Mortgage Trust, Inc. (NYMT) to understand how they fund their operations, which is smart. For a mortgage Real Estate Investment Trust (mREIT), debt is the engine, but too much is a risk. The direct takeaway is that as of the second quarter of 2025, New York Mortgage Trust, Inc.'s leverage is elevated compared to the mREIT industry average, but they have secured significant new financing and increased their operational debt limit, giving them room to grow.

New York Mortgage Trust, Inc. relies heavily on debt to magnify returns, a common practice in the mREIT sector. As of the end of Q2 2025, their recourse leverage ratio-a key metric showing debt relative to equity-increased to 3.8x from 3.4x in the prior quarter, reflecting a more aggressive capital deployment strategy. This ratio means for every dollar of equity, the company is using $3.80 in recourse debt (debt where the company is directly liable) to finance its assets.

Here's the quick math on why this matters: The industry average Debt-to-Equity ratio for Mortgage REITs is around 2.475 as of early 2025. New York Mortgage Trust, Inc.'s 3.8x recourse leverage ratio is defintely higher, placing them on the more aggressive end of the spectrum. This higher leverage can amplify returns when investments perform well, but it also increases the risk of margin calls and financial distress if asset values drop. It's a high-stakes game they play.

The company's financing mix shows a clear focus on long-term debt and securitizations to fuel portfolio growth, especially in Agency Residential Mortgage-Backed Securities (RMBS) and Business Purpose Loans (BPLs). They've been very active in the capital markets in 2025:

• January 2025: Priced an offering of $75 million in 9.125% senior notes due 2030.
• July 2025: Issued an additional $90.0 million in 9.875% Senior Notes due 2030.
• July 2025: Completed a residential loan securitization, generating approximately $345.9 million in net proceeds.

These issuances are long-term debt, which is generally less volatile than short-term repurchase agreements (repo debt), helping to stabilize their funding. Plus, New York Mortgage Trust, Inc. successfully amended their bond terms, increasing their recourse leverage limit from 4x to an aggressive 8x on their 5.75% senior notes due 2026. This move provides significant flexibility to expand their Agency RMBS holdings, which are now 57% of their portfolio assets. They are balancing this debt with shareholder equity, which stood at a book value of $9.11 per common share at the end of Q2 2025. The new leverage limit shows management is prepared to lean into debt to chase returns, but that also raises the risk profile. You need to watch their interest expense closely.

For a detailed look at the core financial metrics driving these decisions, you can read the full analysis in Breaking Down New York Mortgage Trust, Inc. (NYMT) Financial Health: Key Insights for Investors.

Liquidity and Solvency

You're looking at New York Mortgage Trust, Inc. (NYMT) and trying to figure out if they have enough cash to manage their day-to-day operations and capital deployment. The short answer is yes, but you have to look past the traditional metrics. For a mortgage real estate investment trust (mREIT) like New York Mortgage Trust, Inc., the standard Current Ratio (current assets divided by current liabilities) and Quick Ratio aren't the best tools. Their balance sheet is dominated by mortgage-backed securities and loans, and most of their financing-like repurchase agreements-is often classified differently than a typical corporate loan.

What really matters is their available, unencumbered capital. As of the second quarter of 2025 (Q2 2025), New York Mortgage Trust, Inc. reported an excess liquidity capacity of $416 million. This is the war chest. Here's the quick math: that capacity is made up of $156 million in cash and $260 million in available financing lines. This is a defintely strong liquidity position that allows them to act fast on new investment opportunities without scrambling for funds.

The trend in working capital (current assets minus current liabilities) is less clear-cut for an mREIT, but we can look at the overall balance sheet health. A more telling solvency metric is the Recourse Leverage Ratio, which measures debt that the company is directly liable for against its equity. This ratio increased to 3.8x as of June 30, 2025, up from 3.0x at the end of 2024. This increase reflects a more aggressive capital deployment strategy, primarily financing highly liquid Agency Residential Mortgage-Backed Securities (RMBS). It means they are using more debt to buy assets, which is a calculated risk for higher returns-a trade-off you need to watch closely.

Now, let's look at the cash flow statement overview for the six months ended June 30, 2025. This shows where the money is actually moving:

• Operating Cash Flow: Net cash provided by operating activities totaled $65.0 million. This positive number is good; it shows their core business of collecting interest income and managing expenses is generating cash.
• Investing Cash Flow: Net cash used in investing activities was a substantial $1.2 billion. This is a huge outflow, but it's not a concern here. It reflects the company's strategic goal of expanding its portfolio, mainly through purchases of investment securities and residential loans.
• Financing Cash Flow: Net cash provided by financing activities was $1.0 billion. This inflow is what funded the massive investing activity, primarily through new debt and securitization activities.

The net effect of these activities was a decrease in cash, cash equivalents and restricted cash of $61.9 million for the six-month period. What this cash flow picture tells us is that New York Mortgage Trust, Inc. is in a high-growth, high-leverage phase, actively funding its asset acquisition strategy with new debt. The liquidity strength is in their ability to access the financing markets, which they demonstrated by issuing $90 million of senior unsecured notes and completing a $370 million rated securitization in Q2 2025. If you want to dive deeper into who is buying their stock and why, you should check out Exploring New York Mortgage Trust, Inc. (NYMT) Investor Profile: Who's Buying and Why?

The key takeaway is that while the recourse leverage is up, the company has a clear path to funding its growth, and its $416 million in excess liquidity provides a solid buffer against market volatility. The risk is less about immediate insolvency and more about interest rate changes impacting the value of their $8.6 billion investment portfolio.

Valuation Analysis

You need to know if New York Mortgage Trust, Inc. (NYMT) is a bargain or a trap right now. The quick answer is that the market sees it as undervalued based on its assets, but the earnings picture is complex, which is typical for a mortgage real estate investment trust (REIT). The high dividend yield is a major draw, but its sustainability needs a hard look.

The stock has seen a solid run, with its value growing by about 20.6% over the past year leading up to November 2025. As of mid-November 2025, the stock price is hovering around the $7.14 mark. This upward trend suggests investor confidence is slowly returning, but the valuation multiples tell a more nuanced story.

Here's the quick math on key valuation multiples, using data as close to the 2025 fiscal year end as possible:

• Price-to-Book (P/B) Ratio: At approximately 0.78x. We get this by taking the recent stock price of $7.14 and dividing it by the GAAP Book Value per common share of $9.11 from the second quarter of 2025. A P/B ratio under 1.0x suggests the stock is trading at a discount to its net asset value, which is a classic sign of being undervalued.
• Price-to-Earnings (P/E) Ratio: The trailing twelve-month (TTM) P/E ratio as of October 2025 stands high at 37.42x. This is a red flag, as it's significantly more expensive than the historical average for the company. It signals that current earnings don't justify the stock price, but for a REIT, the P/E is often less relevant than other metrics.
• Enterprise Value-to-EBITDA (EV/EBITDA): This metric, which strips out capital structure differences, is a more reasonable 6.67x as of November 6, 2025. This is calculated using a TTM EBITDA of $96.24 million and an Enterprise Value of $642.10 million. This multiple looks far more attractive than the P/E, especially when compared to broader market averages.

The dividend is defintely the main event for New York Mortgage Trust, Inc. You are looking at a trailing twelve-month dividend yield of about 11.67%. That's massive, but you have to check the payout ratio to see if it's sustainable.

What this estimate hides is the payout ratio's danger zone. The trailing dividend payout ratio is an unsustainable 421.05% of earnings. Even the forward-looking estimate for the current year is a lofty 156.86%. A ratio over 100% means the company is paying out more than it earns, likely drawing from capital or debt, which isn't a long-term strategy for a REIT.

Wall Street analysts have weighed in with a consensus rating of Moderate Buy. The average twelve-month price target is set at $7.92. This suggests analysts see an upside from the current price, aligning with the P/B ratio's undervalued signal, but you must be mindful of that payout ratio risk. You can read more about the company's financial health in Breaking Down New York Mortgage Trust, Inc. (NYMT) Financial Health: Key Insights for Investors.

Next step: Dig into the specific sources of their 'Earnings Available for Distribution' (EAD) to see exactly where the dividend money is coming from.

Risk Factors

You're looking at New York Mortgage Trust, Inc. (NYMT) and trying to map out the landmines, which is defintely the right move. The core takeaway here is that while the company is strategically shifting its portfolio, its financial health remains highly sensitive to the interest rate environment and credit risk, as evidenced by recent 2025 performance.

The biggest external risk is still Interest Rate Fluctuations. As a mortgage real estate investment trust (REIT), NYMT's profit is the spread between its asset yields and its cost of borrowing. In the second quarter of 2025, the company reported a Net Interest Spread of just 1.50%, which is the difference between the yield on its interest-earning assets and the cost of its financing. Any unexpected hike in funding costs can quickly erode that margin.

Internal and market risks are also clear in the recent filings. The company's recourse leverage ratio-a measure of debt relative to equity-increased to 3.8 times in the second quarter of 2025, up from 3.2 times just one quarter prior. That's a more aggressive capital deployment strategy that amplifies both gains and losses. Plus, we saw a GAAP Net Loss attributable to common stockholders of $(3.486) million for Q2 2025, or $(0.04) per share, which shows the pressure is real.

• Credit Risk: Economic slowdowns increase the risk of default in their residential loan portfolio.
• Asset Impairment: Ongoing risk, particularly with their legacy multifamily Joint Venture (JV) equity interests, which continue to be a drag on performance.
• Regulatory Compliance: Maintaining REIT status and complying with the Investment Company Act adds a layer of operational complexity and cost.

Here's the quick math on the Q2 2025 performance, which shows the mixed picture:

What this estimate hides is the volatility. EAD per share, the cash flow measure, was $0.22, just enough to cover the quarterly dividend, but it's not a huge cushion. The stock closed at $6.82 on July 30, 2025, trading at a significant discount to its Adjusted Book Value of $10.26 per share, suggesting the market is already pricing in a lot of uncertainty.

Mitigation Strategies and Portfolio Shift

To be fair, New York Mortgage Trust, Inc. (NYMT) management is not sitting still. Their primary mitigation strategy is a decisive portfolio rotation toward more liquid and stable assets, plus vertical integration in their key lending area. They are focused on increasing their exposure to Agency Residential Mortgage-Backed Securities (RMBS) and Business Purpose Loans (BPLs).

In Q2 2025 alone, they acquired $504 million of Agency RMBS and $280 million of Residential Loans (99% BPLs). This shift is meant to de-risk the portfolio while still targeting compelling returns. They also completed the acquisition of the remaining 50% interest in Constructive Loans, LLC, a BPL originator, in July 2025 for approximately $38.4 million, which helps them control the entire origination-to-securitization process.

On the financing side, they are actively managing their capital structure. In July 2025, they issued $90.0 million in 9.875% senior unsecured notes due 2030 to fund general corporate purposes and asset acquisition, which strengthens their liquidity but also adds to the interest expense burden. They also have an active common stock repurchase program, with $189.7 million available as of February 2025, which can support the stock price and reduce outstanding shares.

To get a deeper dive on this, you should check out the full analysis: Breaking Down New York Mortgage Trust, Inc. (NYMT) Financial Health: Key Insights for Investors.

Growth Opportunities

You want to know where New York Mortgage Trust, Inc. (NYMT) is heading, and the data from the first half of 2025 clearly points to a strategic pivot toward higher-margin, interest-earning assets. The core of their future growth isn't a massive market expansion, but rather a deep vertical integration into the residential credit space, which is smart in a volatile rate environment.

The biggest driver of future growth is the continued shift in their investment portfolio. In the second quarter of 2025, the portfolio expanded to a substantial $8.6 billion, a 4% increase for the quarter alone. They are actively deploying capital into two key areas: Agency Residential Mortgage-Backed Securities (RMBS) and business purpose loans (BPLs), which are loans for non-owner-occupied residential properties. This focus helped push their Earnings Available for Distribution (EAD) per share to $0.22 in Q2 2025, up 10% from the prior quarter. That's four straight quarters of EAD growth, a solid trend.

A major strategic initiative that positions New York Mortgage Trust, Inc. (NYMT) for a competitive edge is the acquisition of the remaining 50% stake in Constructive Loans for $38.4 million (a post-Q2 event). This move creates a critical vertical integration, meaning they now control the entire process from loan origination to securitization in the BPL market. This allows them to capture more value along the investment chain and maintain strict control over credit quality, a defintely valuable competitive advantage in residential credit.

Here's the quick math on what analysts are projecting for the near term, based on current momentum and strategy execution:

What this estimate hides is the potential drag from their legacy Multi-Family investments, which the company is slowly off-loading. Still, the overall strategic shift is clear: move away from less liquid assets and double down on the single-family credit and Agency RMBS segments. Their capital allocation reflects this, with 44% of the portfolio allocated to Single-Family Credit/Other and 18% to Single-Family Agency as of Q2 2025. You can see their long-term commitment to this path in their Mission Statement, Vision, & Core Values of New York Mortgage Trust, Inc. (NYMT).

The company's competitive advantages are not just in their portfolio mix, but also in their financial flexibility. They have maintained a strong liquidity position, reporting $416 million in excess liquidity capacity in Q2 2025. This war chest allows them to capitalize on market dislocations-like attractive spreads on Agency RMBS-when they appear, which is crucial for a mortgage real estate investment trust (REIT). They also completed a residential loan securitization post-Q2, generating $345.9 million in net proceeds, further boosting their capacity for new investments.

• Grow EAD through balance sheet expansion.
• Optimize capital to seize market opportunities.
• Generate income from loan origination and property management.

The plan is simple: use their vertical integration to source high-quality loans and their strong liquidity to buy high-yield securities when the market dips. That's how they plan to deliver the projected earnings growth.