Angel Oak Mortgage, Inc. Q4 2025 Earnings Call Summary

2 weeks ago 8

Moby Intelligence

Wed, February 25, 2026 astatine 11:32 AM CST 3 min read

Delivered a 2nd consecutive twelvemonth of double-digit nett involvement income maturation by deploying superior into high-yielding investments portion reducing operating expenses for the 3rd consecutive year.
Attributed GAAP publication worth maturation to improving valuations successful bequest securitizations arsenic rates declined and beardown nett involvement income from caller superior deployment.
Maintained a deliberate strategy of migrating up the recognition spectrum to absorption connected resilient assets, resulting successful recognition show that outperformed the broader market.
Optimized the backing premix done the summation of a caller warehouse recognition installation and a 2nd elder unsecured enactment issuance to enactment accretive indebtedness purchases.
Capitalized connected steadfast securitization markets to execute 4 deals and telephone 2 bequest 2019 deals, allowing for the recycling of de-levered superior into higher-yielding assets.
Expanded the addressable marketplace by completing the company's archetypal HELOC securitization, identifying HELOCs arsenic an charismatic alpha-generating plus people alongside halfway non-QM loans.
Sustained a disciplined underwriting attack that emphasizes prime implicit scale, helping to mitigate competitory terms pressures from caller marketplace entrants.

Management anticipates continued maturation successful nett involvement income driven by ongoing securitization enactment and the acquisition of accretive loans passim 2026.
Guidance assumes a constructive but volatile marketplace situation with expectations for short-term rates to diminution and the output curve to further steepen.
The institution plans to support its people gait of 4 securitizations per year, including astir 2 participations successful HELOC securitizations.
Modeling assumes humanities mean prepayment speeds of 20% to 30%, though absorption notes owe rates would request to autumn meaningfully to importantly interaction existent portfolio returns.
Strategic absorption remains connected managing recourse leverage prudently portion capturing structural request for non-QM solutions from self-employed and non-permanent employees.

Operating expenses decreased by 15.5% twelvemonth implicit year, portion expenses excluding non-cash banal compensation and securitization costs decreased by 15.4%, reflecting palmy outgo rationalization and cardinal disbursal savings initiatives.
The quality betwixt GAAP nett income and distributable net was chiefly driven by the removal of $28,600,000 successful nett unrealized gains from the securitized indebtedness portfolio.
Total portfolio 90-plus time delinquencies ended the twelvemonth astatine 2.18%, a 25 ground constituent alteration compared to the extremity of 2024.
Management noted that portion caller marketplace volatility has caused spreads to widen from caller deals printed betwixt 100 and 110 ground points, they judge the owe marketplace remains coagulated and the non-QM marketplace continues to grow.