JPMorgan downgraded Arbor Realty to Neutral from Overweight with a price target of $11, down from $15. The analyst expects book values to rebound for residential mortgage real estate investment trusts throughout 2023 as the Federal Reserve rate cycle nears its end. However, the firm expects expect mixed results on book value in Q1 given volatility and wider spreads towards the end of quarter following the regional banking crisis. Following the recent default on a large multi-family development, it believes Arbor Realty may begin to more aggressively build reserves, weighing on book value over the next 12 to 24 months.
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Published first on TheFly
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