New York Mortgage Trust, Inc. (NYMT) recently announced the commencement of an underwritten public offering of 2 million shares. To provide cover for over allotments, New York Mortgage also plans to offer an option to the underwriters of purchasing an additional 300,000 shares.
New York Mortgage expects to utilize the proceeds generated from the transaction to buy its targeted assets, including commercial mortgage loans and commercial mortgage-backed securities and Agency residential mortgage-backed securities (RMBS). The company also intends to utilize the proceeds for working capital purposes.
This public offering will enable the company to attain financial flexibility and is expected to position it to seize investment opportunities and acquisitions, which in turn will drive top-line growth. As of March 31, 2011, New York Mortgage’s cash position stood at $8.4 million.
During the first quarter 2011, the company reported earnings of $2.5 million, or 27 cents per share compared with $2.7 million or 28 cents per share in the prior- year quarter.
New York Mortgage together with its subsidiaries operates as a real estate investment trust (REIT) in the United States. It invests primarily in real estate-related assets, including agency residential adjustable rate mortgage-backed securities issued by a government-sponsored enterprise of the United States, prime credit quality residential adjustable-rate mortgage loans and non-agency mortgage-backed securities.
New York Mortgage currently retains a Zacks #3 Rank, which translates into a short-term Strong Hold rating. We are also maintaining our long-term Neutral recommendation on the stock. One of its competitors, MFA Financial, Inc. (MFA) currently retains a Zacks #3 Rank.
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