NEW YORK - New York Mortgage (NASDAQ:NYMT) Trust, Inc. (NASDAQ:NYMT), a real estate investment trust (REIT), has announced the pricing of its public offering of $60 million in senior notes with a 9.125% interest rate, maturing in 2029. The offering is anticipated to close on June 28, 2024, subject to customary closing conditions.
The company has also provided the underwriters a 30-day option to purchase an additional $9 million in notes to cover any over-allotments. If approved, the notes will be listed on the Nasdaq Global Select Market under the ticker symbol NYMTI, and trading is expected to commence within 30 days post-issuance.
NYMT intends to use the proceeds from this offering for general corporate purposes. These include acquiring targeted assets such as single-family and multi-family residential assets, and other mortgage-related and credit-related assets that the company may consider in the future. Additionally, funds may be allocated for general working capital purposes.
The notes, which are unsecured senior obligations of NYMT, will pay quarterly interest on the first day of January, April, July, and October, starting on October 1, 2024. They are set to mature on July 1, 2029, but the company reserves the right to redeem them, in whole or in part, at any time on or after July 1, 2026.
Joint book-running managers for the offering include Morgan Stanley (NYSE:MS) & Co. LLC, RBC (TSX:RY) Capital Markets, LLC, UBS Securities LLC, Wells Fargo (NYSE:WFC) Securities, LLC, Keefe, Bruyette & Woods, Inc., and Piper Sandler & Co.
The offering is being conducted under an existing shelf registration statement that became effective on August 6, 2021. Prospective investors can obtain copies of the prospectus and related supplement from the underwriters.
This news is based on a press release statement and is intended for informational purposes only. It does not constitute an offer to sell or a solicitation of an offer to buy the notes or any other securities. Any such offer would be unlawful in jurisdictions where it is not registered or qualified under the securities laws.
In other recent news, New York Mortgage Trust has seen a series of significant developments. The company held its 2024 Annual Meeting of Stockholders, electing seven directors to its Board of Directors and approving two additional proposals. In addition, the company has declared its Q2 2024 dividends, with a dividend of $0.20 per share on its common stock and further dividends on various series of preferred stock.
The company's Q1 2024 results, however, showed negative earnings per share of $0.75 due to impairments on joint venture equity positions. In response, New York Mortgage Trust is changing its strategy, reducing its exposure to multi-family joint venture equity investments and focusing more on Agency Residential Mortgage-Backed Securities (RMBS) and Business Purpose Loans (BPL).
Analysts at Keefe, Bruyette & Woods (KBW) have adjusted their outlook on the company, lowering the price target from $8.50 to $7.00, while maintaining a Market Perform rating. This revision follows the company's recent earnings report, which revealed an undepreciated earnings per share of -$0.68, falling short of both KBW and consensus estimates. The firm cited increased expenses as the primary reason for the reduction in EPS estimates.
These are among the recent developments for New York Mortgage Trust, reflecting the company's commitment to its stockholders and its efforts to navigate current market challenges.
InvestingPro Insights
As New York Mortgage Trust, Inc. (NYMT) moves forward with its public offering of senior notes, current and potential investors may consider several key metrics and insights from InvestingPro to gauge the company's financial health and future prospects. With a market capitalization of $564.7 million, NYMT's financial landscape presents a complex picture.
The company's Price to Earnings (P/E) Ratio stands at -3.34, indicating that it is not currently profitable, a sentiment echoed by analysts who do not anticipate profitability for this year. Furthermore, the P/E Ratio adjusted for the last twelve months as of Q1 2024 is significantly lower at -18.97, reinforcing concerns about the company's earnings.
Despite these challenges, NYMT has a strong track record of maintaining dividend payments, with a notable 21 consecutive years of consistent dividends, and a current high dividend yield of 12.84%. This commitment to shareholder returns is a critical factor for income-focused investors. Moreover, the company's liquid assets surpass short-term obligations, which suggests a solid position to meet immediate financial liabilities.
Investors should note that two InvestingPro Tips highlight the volatility of NYMT's stock price and a sales decline anticipated by analysts in the current year. The stock has experienced a significant downturn over the last six months, with a price total return of -25.78%, and a year-to-date price total return of -24.91%. These metrics may influence investor sentiment and decision-making, especially in the context of the new notes offering.
For those seeking a more comprehensive analysis, InvestingPro provides additional tips on NYMT that could further inform investment strategies. To access these insights and tips, investors can visit https://www.investing.com/pro/NYMT, and use the coupon code PRONEWS24 to receive an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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