Arbor Story

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ABR -- USA Stock  

USD 16.68  0.19  1.13%

14% of stocks are less volatile than Arbor, and above 96% of all equities are expected to generate higher returns over the next 60 days. While some of us are excited about real estate space, it makes sense to sum up Arbor Realty in greater detail to make a better estimate of its risk and reward. What exactly are Arbor Realty shareholders getting in March? Arbor Realty's very low volatility may have no significant impact on the stock's value as we estimate Arbor Realty as currently fairly valued. The real value, based on our calculations, is getting close to 15.33 per share.
Published over a week ago
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What is March outlook for Arbor Realty (NYSE:ABR) given current volatility levels?
Arbor Realty Trust has 5.18 B in debt with debt to equity (D/E) ratio of 3.92, meaning that Arbor Realty heavily relies on borrowing funds for operations. The entity has a current ratio of 5.85, demonstrating that it is liquid and is capable to disburse its financial commitments when the payables are due.
Volatility is a rate at which the price of Arbor Realty or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Arbor Realty may increase or decrease. In other words, similar to Arbor's beta indicator, it measures the risk of Arbor Realty and helps estimate the fluctuations that may happen in a short period of time. So if prices of Arbor Realty fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.

How important is Arbor Realty's Liquidity

Arbor Realty financial leverage refers to using borrowed capital as a funding source to finance Arbor Realty Trust ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Arbor Realty financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between Arbor Realty's total debt and its cash.

How Arbor utilizes its cash?

To perform a cash flow analysis of Arbor Realty, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Arbor Realty is receiving and how much cash it distributes out in a given period. The Arbor Realty cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.
Arbor Realty Net Cash Flow from Operations is relatively stable at the moment as compared to the past year. Arbor Realty reported last year Net Cash Flow from Operations of 55.16 Million

Arbor Realty Volatility Drivers

Arbor Realty unsystematic risk is unique to Arbor Realty Trust and usually not directly affected by the market or economic environment. An example of unsystematic risk is the possibility of poor earnings or a layoff due to coronavirus. One may mitigate nonsystematic risk by buying different securities in the same industry or by buying in different sectors. For example, if you have a position in Arbor Realty you can also buy Dynex Capital. You can also mitigate this risk by investing in the reit?mortgage sector as well as in companies having nothing to do with it. This type of risk is also called diversifiable risk and can be understood from analyzing Arbor Realty important indicators over time. Here we run a correlation analysis between relevant fundamental ratios over at least ten year period to find a relationship in the way they react to changes in Arbor Realty income statement and balance sheet. Here are more details about Arbor volatility.
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0.990.920.98-0.810.930.980.86-0.660.950.830.820.910.870.950.93-0.210.960.540.69-0.260.58-0.090.1-0.170.61-0.130.490.920.40.240.10.02-0.110.640.990.880.920.99-0.120.980.980.99
1.00.91.0-0.820.921.00.86-0.740.980.810.810.950.880.930.95-0.230.960.570.67-0.170.58-0.110.08-0.150.66-0.150.460.890.330.130.060.0-0.130.71.00.870.911.0-0.081.01.00.99
Click cells to compare fundamentals   

A Deeper Perspective

The firm reported the last year's revenue of 359.33 M. Total Income to common stockholders was 102.32 M with profit before taxes, overhead, and interest of 351.54 M.
 2018 2019 2020 2021 (projected)
Revenues USD331.08 M349.39 M401.79 M433.51 M
Revenues331.08 M349.39 M401.79 M433.51 M

Will Arbor Realty latest spike continue?

Latest variance is at 2.81. Arbor Realty Trust has relatively low volatility with skewness of -0.04 and kurtosis of -0.02. However, we advise all investors to independently investigate Arbor Realty Trust to ensure all accessible information is consistent with the expectations about its upside potential and future expected returns.

Our Takeaway on Arbor Realty Investment

While some other companies under the reit?mortgage industry are still a bit expensive, Arbor Realty may offer a potential longer-term growth to retail investors. With a less-than optimistic outlook for your 30 days horizon, it may be a good time to sell some or all of your Arbor Realty holdings as it seems the potential growth was already fully factored into the current price. Please use our equity advice module to run different scenarios to ensure your current risk level and investment horizon are fully reflective of your current investing preferences in regards to Arbor Realty.

About Contributor

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Raphi Shpitalnik do not own shares of Arbor Realty Trust. Please refer to our Terms of Use for any information regarding our disclosure principles.

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