Arbor Realty Trust Gears Up for Q4 Earnings: Here's What to Expect

Arbor Realty Trust ABR is slated to report fourth-quarter 2025 results on Feb. 27, 2026. The company is likely to have registered year-over-year declines in interest income and earnings.

In the last reported quarter, this New York-headquartered real estate investment trust (REIT), which primarily focuses on originating and servicing loans for multi-family, single-family and other commercial real estate assets, posted distributable earnings of 35 cents per share, beating the Zacks Consensus Estimate by 25%. However, the net interest income was $223 million in the quarter, which missed the Zacks Consensus Estimate by 7.1%.

Over the trailing four quarters, Arbor Realty Trust surpassed the Zacks Consensus Estimate in one of the trailing four quarters and missed thrice, with an average negative surprise of 3.39%.

Arbor Realty Trust Price and EPS Surprise

Arbor Realty Trust price-eps-surprise | Arbor Realty Trust Quote

Key Factors to Influence ABR in Q4

The mREIT sector continued to witness fixed-income markets volatility, which is likely to have increased asset impairment risks and hedging mismatches for ABR in the quarter to be reported. Nonetheless, a positively sloped yield curve is anticipated to have supported mortgage REITs’ valuations. With a steeper yield curve, mortgage REITs are likely to have seen an increase in tangible book value as spreads on benchmark indices tightened during the quarter. This is likely to have increased ABR’s book value per share in the quarter to be reported.

Modest new agency loan originations in the quarter to be reported are likely to have supported the company’s fee-based servicing portfolio. The Zacks Consensus Estimate for ABR's net servicing revenues is pegged at $28.9 million, indicating a 13.3% year-over-year decline.

Arbor Realty Trust’s loan portfolio has significant exposure to multi-family assets. Despite the easing rate environment, the volatility in the multifamily market, is expected to have weighed on the company’s performance in the to-be-reported quarter.

The 30-year fixed mortgage rates in the fourth quarter of 2025 averaged around 6.2%, slightly below the 6.3% seen at the end of the third quarter. This is likely to have supported mortgage demand, leading to decent growth in refinancing activity and origination volumes during the quarter. Amid this, a portion of ABR’s mortgage-backed securities (MBS) holdings is anticipated to have witnessed elevated levels of constant prepayment rate. This is likely to have supported mortgage servicing rights amortization to some extent in the to-be-reported quarter. The consensus estimate for ABR’s revenues from mortgage servicing rights is pinned at $11.1 million, suggesting a 17.1% year-over-year decline.

Primary-secondary spreads, which represent the difference between borrower mortgage rates and the yield on newly issued agency MBS, remained wider in the fourth quarter of 2025 compared with the third quarter. However, with increased markets volatility, gain-on-sale margins are expected to have declined in the to-be-reported quarter. The Zacks Consensus Estimate for the gain on sales revenues is pegged at $16.7 million, suggesting a decline of 24.7% from the prior-year quarter’s reported figure.

Since September 2025, the Federal Reserve has cut interest rates three times, including two reductions in the fourth quarter to 3.5%–3.75%. Given this backdrop, the company is expected to have benefited from relatively lower funding costs. This is likely to have supported net interest income growth to some extent in the to-be-reported quarter. The Zacks Consensus Estimate for interest income is $219.5 million, suggesting an 8.8% year-over-year decline.

What the Zacks Model Reveals for Arbor Realty Trust

Our proven model does not conclusively predict an earnings beat for ABR this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Earnings ESP: Arbor Realty Trust has an Earnings ESP of 0.00%.

Zacks Rank: The company currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for fourth-quarter earnings has remained unchanged at 21 cents per share over the past seven days, reflecting a 47.5% year-over-year decline.

The consensus estimate for revenues is pegged at $221.7 million, implying a 15.7% decrease from the prior-year quarter’s reported figure.

Performance of ABR's Peers

Annaly Capital Management, Inc. NLY reported fourth-quarter 2025 earnings available for distribution per average share of 74 cents, which beat the Zacks Consensus Estimate of 72 cents. The figure increased from 72 cents in the year-ago quarter.

NLY’s average yield on interest-earning assets improved in the reported quarter. Notably, the year-over-year increase in book value per share was also encouraging.

AGNC Investment Corp.’s AGNC fourth-quarter 2025 net spread and dollar roll income per common share (excluding estimated "catch-up" premium amortization benefit) of 35 cents missed the Zacks Consensus Estimate of 37 cents. Also, the bottom line declined 5.4% from the year-ago quarter.

The results of AGNC were adversely impacted by a decline in average asset yield and reduced net interest spread. Further, a higher weighted average cost of funds was another concern. However, a rise in tangible net book value per share on the portfolio was positive.

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This article originally published on Zacks Investment Research (zacks.com).

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