Angel Oak Mortgage (NYSE:AOMR) stock tanked 9.2% in Monday afternoon trading after Bank of America analyst Derek Hewett downgraded the mortgage REIT to Underperform from Buy, arguing that near-term risks remain skewed to the downside.
AOMR stock is changing hands at $6.04 as of 2:40 p.m. ET, marking new all-time lows after the company first started trading at $18.65 on June 17, 2021.
The company, which invests in first lien non-qualified mortgage loans and other mortgage-related assets, is suffering from near-term headwinds such as wider credit spreads amid high volatility across the fixed income and securitization markets, the analyst wrote in a note.
"Illiquidity and dislocation in the securitization market has limited access to permanent non-course financing, which unlocks liquidity that can be recycled into new purchases," according to the note.
The Underperform rating disagrees with the average Wall Street analyst rating of Buy.
Previously, (Nov. 21) Angel Oak Mortgage slid on slow portfolio growth, contracted 2023 margins.
