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    ADAM
    Earnings call· Jun 2026(Q2 FY26)

    ADAMAS TRUST Q2 FY26 earnings call ADAM

    Jul 30, 2026 Source

    Executive summary

    New York Mortgage Trust Q2 FY26 — Strong Earnings Growth and Book Value Expansion

    New York Mortgage Trust delivered strong Q2 FY26 results, marked by consistent earnings growth, increased book value, and significant expansion of its diversified investment portfolio, particularly in residential credit. The company navigated market volatility effectively, leveraging its integrated origination platform and disciplined capital allocation. Management remains focused on further scaling its Constructive platform and closing the valuation gap.

    Highlights

    5

    • Generated GAAP earnings of $0.48 per common share and EAD of $0.30 per share, marking the ninth EAD increase in 10 quarters.

    • GAAP book value increased 1.8%, while adjusted book value increased 2.3%, marking the fourth consecutive quarter of book value growth.

    • Expanded the investment portfolio by over $800 million to $11.7 billion, representing 36% growth from a year ago.

    • Added a record $632 million of business purpose loans, primarily sourced from Constructive's origination platform.

    • Stock significantly outperformed the broader mortgage REIT index by approximately 46% on a total return basis over the past year.

    Concerns

    3

    • Operated in a volatile market environment, including a meaningful bear flattener of the Treasury curve.

    • Higher interest rates created temporary pressure on asset valuations, resulting in $8.5 million of net unrealized losses on portions of the investment portfolio.

    • Quarter-to-date adjusted book value was down approximately 2.3% as of July 28.

    Guidance & targets

    4
    CategoryTargetConfidence
    BPL rental securitizations
    5 to 6
    medium materiality
    Medium
    Constructive Annual ROE
    15%
    medium materiality
    Medium
    Consolidated G&A ratio
    7% to 7.5%
    low materiality
    High
    Company recourse leverage
    Slightly increase
    medium materiality
    Medium

    Operational metrics

    48
    EAD per share
    $0.30up 36% year-over-year
    Q2 FY26

    This marks the ninth increase in EAD over the past 10 quarters.

    Quarterly dividend
    $0.27increased
    Q2 FY26

    The Board increased the quarterly dividend, which remains well covered by EAD.

    Economic return on GAAP book value
    4.5%
    Q2 FY26

    Calculated after accounting for the dividend.

    Economic return on adjusted book value
    4.8%
    Q2 FY26

    Calculated after accounting for the dividend.

    GAAP book value
    $10.16increased 1.8%
    Q2 FY26

    Extending the track record of consistent book value growth.

    Adjusted book value
    $11.05increased 2.3%
    Q2 FY26

    Extending the track record of consistent book value growth.

    Adjusted book value quarter-to-date
    -2.3%down
    Q3 FY26 (QTD as of July 28)

    Estimated as of close of business on July 28.

    Investment portfolio size
    $11.7 billionup $800 million QoQ, up 36% YoY
    Q2 FY26

    Expanded by more than $800 million during the quarter.

    Agency RMBS portfolio % of investment portfolio
    61%
    Q2 FY26

    Remains the cornerstone of the balance sheet.

    Agency RMBS portfolio size
    $7.2 billionup from $6.8 billion QoQ
    Q2 FY26

    Driven largely by growth in the TBA book.

    Agency leverage
    8.3xup from 7.8x QoQ
    Q2 FY26

    Consistent with the target range for managing the portfolio.

    TBA positions
    $664 million
    Q2 FY26

    Expected to rotate back into spec pools in the future.

    Non-agency residential issuance YTD
    $132 billion
    YTD 2026

    On pace to comfortably exceed last year's approximately $215 billion of securitization volume.

    Non-QM AAA spreads
    130tightened from 145 basis points QoQ
    Q2 FY26

    Alongside a flatter credit curve, with improved mezzanine tranche execution.

    NYMT securitization AAA spread
    125tighter than broader market
    Q2 FY26

    Repriced most recent deal tighter than the broader market.

    BPL rental portfolio size
    $2.3 billion
    Q2 FY26

    The company's BPL rental portfolio has grown to this amount.

    Constructive BPL production with prepayment protection
    100%
    Last 12 months

    Mostly with prepayment penalty terms that last for as long as five years.

    Constructive BPL rental book delinquency (60+ days)
    Less than 1%
    Q2 FY26

    Demonstrates excellent credit performance.

    Constructive profitability
    Profitable in 28 of last 30 months
    Last 30 months

    Impressive track record across market cycles.

    Constructive originated BPL
    $428 millionin line with prior quarter
    Q2 FY26

    Originated business purpose loans during the quarter.

    NYMT purchase of Constructive originations
    71%
    Q2 FY26

    NYMT was the primary purchaser of Constructive's loan production.

    Constructive loan financing savings
    60compared to existing financing lines
    Ongoing

    From onboarding a new institutional loan financing counterparty.

    Constructive annual cost savings identified
    $3 million
    Annual

    Identified across its loan origination process, expected to flow through in H2 2026 and 2027.

    Multifamily assets
    $192 million
    Q2 FY26

    Value of assets in the multifamily book at quarter end.

    Multifamily coupon
    12%
    Q2 FY26

    Continues to contribute positively to recurring income during the wind-down.

    Multifamily loans with mark-to-market provisions
    93%
    Q2 FY26

    These provisions provide incentive for timely resolutions.

    GAAP net income attributable to common stockholders
    $43.4 million
    Q2 FY26

    Reported for the second quarter.

    Interest income
    $50.2 million
    Q2 FY26

    Increased during the quarter.

    Adjusted net interest income
    $50.3 million
    Q2 FY26

    Reflecting continued portfolio expansion.

    Net interest spread
    148increased
    Q2 FY26

    Primarily due to lower financing costs.

    Derivative gains
    $48.8 million
    Q2 FY26

    Contributed positively to quarterly results, offsetting unrealized losses on the investment portfolio.

    Net unrealized losses on investment portfolio
    $8.5 million
    Q2 FY26

    Recorded as higher interest rates reduced the value of agency RMBS and certain residential loans.

    Mortgage banking income (Constructive)
    $16.2 million
    Q2 FY26

    Benefiting from stronger gains on loan sales and higher origination fee income.

    Constructive direct loan origination costs
    $4.8 million
    Q2 FY26

    Costs associated with loan originations.

    Constructive direct G&A expenses
    $9.8 million
    Q2 FY26

    General and administrative expenses for Constructive.

    Constructive standalone profit
    $2 million
    Q2 FY26

    Profit generated by Constructive on a standalone basis.

    Constructive annualized ROE
    12%
    H1 FY26

    Annualized return on equity for Constructive during the first half of the year.

    Total consolidated G&A
    $25.6 million
    Q2 FY26

    Within the estimated G&A ratio of approximately 7% to 7.5% in 2026.

    BPL rental securitizations completed
    2
    Q2 FY26

    Completed during the quarter.

    BPL rental securitizations total value
    $521 million
    Q2 FY26

    Totaling approximately $521 million.

    BPL rental securitizations weighted average effective cost
    5.48%
    Q2 FY26

    Weighted average effective cost for the completed securitizations.

    Warehouse capacity increase
    $250 million
    Q2 FY26

    Increased during the quarter.

    Total warehouse capacity
    $3.7 billion
    Q2 FY26

    Total capacity after the increase.

    Available cash
    $182 million
    Q2 FY26

    Ended the quarter with approximately this amount.

    Total liquidity capacity
    $400 million
    Q2 FY26

    Including financing available on unencumbered assets and under-levered assets.

    Company recourse leverage
    5.5x
    Q2 FY26

    Believed to be a disciplined approach to leverage.

    Portfolio recourse leverage
    5.2x
    Q2 FY26

    Primarily concentrated on agency financing.

    ATM equity program maximum amount
    $250 millionincreased from $100 million
    Q2 FY26

    Renewed and increased to preserve long-term financial flexibility.

    Industry KPIs

    2
    MetricValueDetails
    Investment volume closed$1.5 billionUSD
    Ffo core ffo normalized ffo per share$0.30per share

    Deals & partnerships

    1
    New institutional loan financing counterpartyOnboarded a new counterparty for loan financing for Constructive.

    This new counterparty will provide approximately 60 basis points of savings compared to existing financing lines, along with materially fewer aging restrictions and greater capital flexibility for Constructive.

    Risks & headwinds

    3
    Volatile market environmentQ2 FY26

    meaningful bear flattener of the Treasury curve

    Mitigation: Diversified platform, effective hedging strategy.

    Temporary pressure on asset valuations from higher interest ratesQ2 FY26

    $8.5 million net unrealized losses on investment portfolio

    Mitigation: Diversified portfolio and hedging strategy performed as intended, derivative gains offset losses.

    Quarter-to-date book value declineQ3 FY26 (quarter-to-date as of July 28)

    down approximately 2.3%

    Mitigation: Overall strategy focuses on book value stability through diversification and active management.

    What to watch in Q3 FY26

    4

    Constructive Cost Savings Implementation

    Latter half of 2026 and into 2027
    CurrentApproximately $3 million annual savings identified
    TargetStart to flow through to financials

    Why it matters

    These savings are expected to improve Constructive's profitability and help achieve the 15% ROE target, impacting overall company earnings.

    And we expect the implementation of these improvements to occur over the coming quarters. As a result, these annual savings should start to flow through to Constructive's financials in the latter half of 2026 and into 2027.

    Q&A highlights

    7

    What are the current trends in Constructive's BPL pipeline, including coupons, volume, and competition, given recent rate movements?

    Constructive's pipelines are strong with higher coupons than at quarter-end. Cost savings initiatives are being implemented. Institutional demand for securitizations remains robust, providing pricing benchmarks and confidence for whole loan buyers, making markets conducive for business despite volatility.

    “We see the pipelines in Constructive as being strong so far, and furthermore that the coupons that are in the pipeline are higher than the coupons that we had at quarter end.”

    asked by Francesco Labetti · answered by Nicholas Mah

    2 min read6 chapters

    Detailed Narrative

    01

    Diversified Business Model

    New York Mortgage Trust has transformed into a diversified mortgage REIT with three core businesses: a high-quality agency RMBS portfolio, a growing residential credit platform focused on business purpose lending, and an integrated origination platform. This diversification aims to improve earnings quality, book value stability, and operating efficiency, contributing to consistent shareholder value over the long term⏳.

    02

    Investment Portfolio Expansion

    The company expanded its investment portfolio by over $800 million to $11.7 billion in Q2 FY26, representing 36% year-over-year growth. This expansion was driven by disciplined capital allocation, with agency RMBS remaining the cornerstone at 61% of the portfolio, and a record $632 million in business purpose loans added, primarily from Constructive's origination platform.

    03

    Constructive Platform Performance

    Constructive, a top five specialist business purpose loan originator, demonstrated strong performance, contributing to a record quarter for BPL purchases. It has been profitable in 28 of the last 30 months and is implementing initiatives to improve funding costs by approximately 60 basis points and reduce operating expenses by an identified $3 million annually, targeting a 15% annual ROE.

    04

    Multifamily Portfolio Wind-Down

    The multifamily book, valued at $192 million, is undergoing a steady wind-down with consistent payoff rates. The portfolio benefits from a 12% coupon, contributing positively to recurring income, and 93% of loans contain mark-to-market provisions, incentivizing timely resolutions. Capital from these payoffs is redeployed into higher-yielding core strategies to generate stronger returns.

    05

    Capital Allocation and Leverage Strategy

    NYMT dynamically allocates capital to the best relative value opportunities across its core strategies, currently favoring residential credit due to expanded ROEs. Agency leverage increased from 7.8x to 8.3x, within the target range, and overall company recourse leverage of 5.5x is considered comfortable, with potential for slight increases as unlevered non-core assets roll off into levered strategies.

    06

    Market Outperformance and Valuation Gap

    NYMT's stock has significantly outperformed the broader mortgage REIT index by approximately 46% on a total return basis over the past year. The company's share price continued to narrow its discount to book value, extending progress in closing the valuation gap, though management believes shares still do not reflect the intrinsic value of the company.

    AI-generated summary of the company’s earnings call. Not investment advice.