ARMOUR Residential REIT, Inc.
ARMOUR Residential REIT, Inc. Fundamental Analysis
ARMOUR Residential REIT, Inc. (ARR) shows moderate financial fundamentals with a PE ratio of 6.19, profit margin of 36.61%, and ROE of 16.65%. The company generates $0.9B in annual revenue with weak year-over-year growth of -46.65%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of -12.6/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze ARR's fundamental strength across five key dimensions:
Efficiency Score
WeakARR struggles to generate sufficient returns from assets.
Valuation Score
ExcellentARR trades at attractive valuation levels.
Growth Score
ModerateARR shows steady but slowing expansion.
Financial Health Score
WeakARR carries high financial risk with limited liquidity.
Profitability Score
ExcellentARR achieves industry-leading margins.
Key Financial Metrics
Is ARR Expensive or Cheap?
P/E Ratio
ARR trades at 6.19 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, ARR's PEG of 0.00 indicates potential undervaluation.
Price to Book
The market values ARMOUR Residential REIT, Inc. at 0.88 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at -25.04 times EBITDA. This is generally considered low.
How Well Does ARR Make Money?
Net Profit Margin
For every $100 in sales, ARMOUR Residential REIT, Inc. keeps $36.61 as profit after all expenses.
Operating Margin
Core operations generate 56.42 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $16.65 in profit for every $100 of shareholder equity.
ROA
ARMOUR Residential REIT, Inc. generates $1.54 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
ARMOUR Residential REIT, Inc. produces operating cash flow of $178.53M, showing steady but balanced cash generation.
Free Cash Flow
ARMOUR Residential REIT, Inc. generates strong free cash flow of $178.53M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $1.60 in free cash annually.
FCF Yield
ARR converts 8.99% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
6.19
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.002
vs 25 benchmark
P/B Ratio
Price to book value ratio
0.88
vs 25 benchmark
P/S Ratio
Price to sales ratio
2.26
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
7.94
vs 25 benchmark
Current Ratio
Current assets to current liabilities
0.008
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.17
vs 25 benchmark
ROA
Return on assets percentage
0.02
vs 25 benchmark
ROCE
Return on capital employed
0.16
vs 25 benchmark
How ARR Stacks Against Its Sector Peers
| Metric | ARR Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 6.19 | 24.23 | Better (Cheaper) |
| ROE | 16.65% | 659.00% | Weak |
| Net Margin | 36.61% | 4497.00% | Weak |
| Debt/Equity | 7.94 | -22.14 (disorted) | Distorted |
| Current Ratio | 0.01 | 13.87 | Weak Liquidity |
| ROA | 1.54% | -1390.00% (disorted) | Weak |
ARR outperforms its industry in 1 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews ARMOUR Residential REIT, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
-75.01%
Industry Style: Income, Inflation Hedge, REIT
DecliningEPS CAGR
98.72%
Industry Style: Income, Inflation Hedge, REIT
High GrowthFCF CAGR
242.41%
Industry Style: Income, Inflation Hedge, REIT
High Growth