Timothy D'Agostino

Timothy D'Agostino requested an update and more color on the performance of the 5.11 subsidiary.

Answer

Elias Sabo (Partner and CEO, Compass Diversified) explained that 5.11's professional side shows good, steady growth from government and municipality spend, while the consumer side faces headwinds. He noted that 5.11's price-sensitive consumer base, coupled with inflation and apparel tariffs, led to high elasticity of demand and gross margin dilution. Sabo highlighted that 5.11 has offset some gross margin degradation through SG&A cuts enabled by AI initiatives, driving positive operating earnings growth despite consumer challenges.

Timothy D'Agostino asked management to outline their top priorities for 2026, specifically regarding capital structure optimization, portfolio allocation strategies, and potential actions like preferred stock buybacks.

Answer

Larry Penn, President and CEO, discussed capital structure priorities, including monitoring the preferred market for refinancing and potential future unsecured notes offerings. J.R. Herlihy, CFO and Treasurer, reiterated 2025's accomplishments as ongoing themes for 2026: dividend coverage, liability structure strengthening, originator support, delinquency management, and disciplined portfolio growth. Mark Tecotzky, Co-Chief Investment Officer, highlighted the broad capabilities of Ellington Management Group and the evolving opportunity set across various structured products, including small balance commercial loans.

Timothy D'Agostino from B. Riley Securities requested more color on how the market for Carlyle Credit Income Fund looked different in February compared to January, specifically considering the cessation of loan repricings and the impact of AI fears on software and other sectors.

Answer

Lauren Basmadjian, CCIF's Chair and Carlyle's Global Head of Liquid Credit, explained that performing credit without AI fears was down half a point to three-quarters of a point, while names with AI fears, particularly in software, asset managers, and insurance brokers, experienced more significant volatility. She highlighted that this volatility has created opportunities to source loans and build par as most of the market is trading under par.

Timothy D'Agostino asked for more color on how the loan market differed between January and February, specifically regarding loan repricings and the impact of AI on software and other sectors.

Answer

Lauren Basmadjian explained that performing credit without AI fears saw a slight decline (half to three-quarters of a point), while names with AI concerns, particularly in software, experienced more significant volatility. She noted that this volatility has created opportunities to source loans and build par, as most of the market is now trading under par.

Timothy D'Agostino inquired about the composition of new definitive commitments, specifically seeking color on the number and dollar amount of larger-scale cases, given the absence of significant case resolutions in 2025.

Answer

CEO Christopher Bogart directed to the detailed table on Burford Capital's website for granular information, emphasizing the diversification of new investments across various industries, case types, geographies, and commitment sizes, from large to relatively small matters.

Timothy D'Agostino inquired about the composition of new definitive commitments, specifically regarding the number and dollar amount of larger-scale cases, given the absence of significant case resolutions in 2025.

Answer

CEO Christopher Bogart directed to the detailed table on Burford Capital's website for granular information, noting that new investments in 2025 showed significant diversification across industries, case types, geographies, and commitment sizes, ranging from large to relatively small matters.

Timothy D'Agostino asked for an overview of the market sentiment and conditions at the start of 2026 compared to 2025, seeking insights into observed changes. He also inquired about the normalized prepayment speed (CPR) for the RMBS portfolio, particularly in relation to specified pools and potential future rate environments.

Answer

Chief Investment Officer Julian Evans detailed the market's evolution, noting initial spread tightening due to GSE reinvestment news, followed by widening in February, a flattening yield curve, and a flight to quality. Regarding CPR, Mr. Evans explained that specified pools, primarily in the 5% and 5.5% coupon range, are currently prepaying at 9-12% and could reach 20% if mortgage rates hit 5.5%. He added that TBA deliverable speeds might reach 30-40%, while the overall portfolio's maximum CPR is estimated around 15%, benefiting from being purchased at a discount, a point President and CEO Jay Lown also emphasized.

Timothy D'Agostino, on behalf of Randy Binner, inquired about the drivers behind lower-than-expected servicing costs and the company's outlook on financial leverage for the remainder of 2025.

Answer

An executive attributed lower servicing costs to the resolution of deboarding fees related to the Mr. Cooper acquisition and a declining loan count. Chief Investment Officer Julian Evans added that leverage is expected to 'creep up' through the end of the year, as a potentially more accommodative Fed policy would make spread assets more attractive.

Timothy D'Agostino sought Angel Oak Mortgage REIT's perspective on the current market sentiment and activity levels in the non-QM, HELOC, and securitization markets, comparing the start of 2026 to 2025. He also inquired about the expected pace of HELOC securitizations for AOMR.

Answer

CEO Sreeniwas Prabhu described 2025 as a solid year for the mortgage market, continuing into 2026, despite recent volatility causing spreads to widen. He noted the non-QM market's growth and increasing competition, emphasizing Angel Oak's focus on quality over scale. Mr. Prabhu anticipates pockets of volatility in 2026 but generally a solid market. Regarding HELOC securitizations, Mr. Prabhu and CFO Brandon Filson expect AOMR to participate in 1 to 2 deals per year, following the pace set since HELOC purchases began in late 2025.

Timothy D'Agostino inquired about the overall market sentiment and activity levels in the non-QM, HELOC, and securitization markets, comparing the start of 2026 to 2025, and asked about the expected pace of HELOC securitizations for Angel Oak Mortgage REIT.

Answer

CEO Sreeniwas Prabhu described 2025 as a solid year, with continued growth in the non-QM market but increasing competition. He noted spread volatility in securitization markets and anticipated pockets of volatility in 2026. Regarding HELOC securitizations, Mr. Prabhu and CFO Brandon Filson indicated Angel Oak Mortgage REIT would likely participate in 1 to 2 deals per year, potentially two, given their recent entry into the HELOC buying space.

Timothy D'Agostino asked if Adamas Trust has a specific target size or growth goal for its total investment portfolio, given the projected 60-70% agency capital allocation and expected decline in BPL bridge loans for 2026. He also sought an overview of how the company plans to allocate its available cash, which stood at $206 million at year-end, compared to an average of $170 million over the trailing five quarters.

Answer

Jason Serrano, CEO, clarified that the primary goal is to maximize total return and recurring earnings, not to reach a specific portfolio size target. Capital allocation shifts based on market opportunities and the risk-adjusted returns available in different asset classes. Regarding available cash, Jason Serrano explained that the higher year-end balance was partly due to tighter agency spreads reducing deployment expectations, leading to the early redemption of the 5.75% note due April 2026. He anticipates continued deployment into Agency MBS and opportunistic trades, maintaining a capital-light model for Constructive.

Timothy D'Agostino (B. Riley Securities) sought clarification on AdamasTrust's target total investment portfolio size, given the projected 60-70% agency allocation and expected decline in BPL bridge loans in 2026. He also asked for an overview of the company's plan for allocating its $206 million available cash at year-end.

Answer

Jason Serrano, CEO, stated that the primary goal is to maximize total return and recurring earnings, not to achieve a specific portfolio size. He explained that capital allocation is dynamic, responding to market opportunities in credit and agency assets. Regarding available cash, Jason Serrano noted that higher-than-expected cash at year-end, due to tighter agency spreads, allowed for the early redemption of the 5.75% note due April 2026, with future plans for continued deployment in capital-light Constructive strategies and opportunistic agency trades.

Timothy D'Agostino inquired about the potential for ARMOUR Residential REIT's portfolio and interest-bearing assets to grow in 2026, following a significant 49% year-over-year increase in 2025. He also sought confirmation on the most recent book value per share.

Answer

CEO Scott Ulm explained that future growth is contingent on capital raising opportunities and attractive investment prospects, which are market-dependent. He confirmed the book value as of February 17, 2026, was $18.37 per common share, after accounting for January dividend payment and February dividend accrual.

Timothy D'Agostino inquired about the outlook for portfolio and interest-bearing asset growth in 2026, following a significant 49% year-over-year increase in 2025. He also sought confirmation on the most recent book value per share.

Answer

CEO Scott Ulm explained that future growth depends on market behavior, specifically investment opportunities and capital raising, emphasizing a selective approach. He confirmed the book value as of Tuesday was $18.37 per share, after accounting for January dividend payment and February dividend accrual.

Timothy D'Agostino asked about the factors needed for the economic net interest margin to continue widening or pick up pace through year-end and into 2026.

Answer

CFO Gordon Harper stated that the trend depends on the portfolio's construction and the pace of Fed rate cuts impacting financing costs. Co-Chief Investment Officer Desmond Macauley added that forward ROEs of 16%-18% on production coupons are considered, with the 18% dividend yield serving as a hurdle rate, indicating a constructive medium-term outlook for assets to exceed this rate with further tightening.

Timothy D'Agostino from B. Riley Securities asked about the factors needed for the economic net interest margin, which widened by one basis point quarter-over-quarter, to continue or accelerate its trend through year-end and mid-2026.

Answer

CFO Gordon Harper stated that the trend depends on the portfolio and the pace of Fed rate cuts, which impact financing costs, emphasizing that the company does not typically provide forward-looking earnings statements. Co-Chief Investment Officer Desmond Macauley added that they focus on forward ROEs, with production coupons yielding 16% to 18%, aligning with their 18% hurdle rate (dividend yield plus operational expenses).

Timothy D'Agostino inquired about the performance and future plans for the San Jose Hotel property, including the impact of recent events like the Super Bowl and ongoing renovations, as well as the strategy for the net lease and other real estate portfolio in 2026.

Answer

CEO Michael Mazzei reported that the Super Bowl event went very well and detailed ongoing upgrades to the hotel's lobby, elevators, washrooms, and ballroom to enhance value before a potential sale. He mentioned upcoming events like the CrossFit National Championship and a budgeting of approximately $9 million in NOI, with hopes to reach double-digit NOI cash flow by year-end. Regarding the net lease portfolio (Labcorp, Northrop Grumman, Albertsons), Mazzei stated there are no immediate plans for growth or sales, given existing lease and debt maturities.

Timothy D'Agostino from B. Riley Securities asked for an update on the San Jose Hotel property, specifically how the Super Bowl event performed and if progress is meeting expectations, and also inquired about the 2026 plan for the net lease and other real estate portfolio.

Answer

Mike Mazzei, CEO, reported that the Super Bowl event for the San Jose Hotel went very well, with staff handling volume effectively. He outlined ongoing upgrades to the lobby, elevators, washrooms, and ballroom, and mentioned upcoming events like the CrossFit National Championship. Mazzei noted a current NOI budget of approximately $9 million, with a goal to reach double-digit NOI cash flow before considering a sale to redeploy the $85 million of equity. Regarding the net lease portfolio (Labcorp, Northrop Grumman, Albertsons), Mazzei stated there are no immediate plans for sales due to existing lease and debt terms, and the company is not looking to expand this portfolio.

Timothy D'Agostino from B. Riley Securities asked about the outlook for CLO resets and refinancings in 2026, comparing it to the 34 resets and 27 refinancings completed in 2025. He also sought more specific details on the types of private credit products or instruments the company is interested in for 2026 and 2027, beyond CLOs.

Answer

Thomas Majewski, Chief Executive Officer, indicated that predicting the exact level of resets and refinancings for 2026 is difficult, as it depends on AAA spreads and curve steepness. He advised looking at the Q3 report's CLO equity positions with AAA spreads to gauge potential opportunities. For private credit, he detailed investments in asset-backed securities (8.4% of portfolio as of Sept 30), collateralized fund obligations (5%), equipment leases (0.35%), other financial services (3.86%), and regulatory capital relief (5%), noting these are typically mid-teens return opportunities with structural complexity.

Timothy D'Agostino asked about the outlook for CLO resets and refinancings in 2026, comparing it to the significant activity in 2025, and sought more color on the specific types of private credit instruments or products the company finds attractive for investment outside of CLOs in 2026 and 2027.

Answer

CEO Thomas Majewski indicated that predicting the exact level of resets and refinancings for 2026 is difficult, as it depends on AAA spreads and curve steepness, but noted a 'pretty robust calendar' of potential opportunities. He explained that the company focuses on CLOs with AAA spreads wider than the current market bogey (115-120 basis points). Regarding private credit, Majewski detailed investments in asset-backed securities, collateralized fund obligations, equipment leases, other financial services investments, and regulatory capital relief transactions, emphasizing their mid-teens return potential and the firm's extensive experience.

Timothy D'Agostino from B. Riley Securities asked about the current momentum of FBRT's agency business in 2026, specifically regarding multifamily volume, and the outlook for the year given the strong 2025 performance. He also inquired about the persistence of high loan repayments in the portfolio and whether the company expects similar figures in the first half of 2026.

Answer

CEO Michael Comparato explained that the agency business, and all FBRT's businesses, are highly sensitive to interest rates, with even small movements in the 10-year Treasury significantly impacting market volume. He noted that while repayments are a mixed blessing, FBRT is actively cycling through its legacy portfolio, which is now down to 32% backward-looking. Comparato expressed strong conviction that the market is mispricing FBRT due to a disconnect between its book value and share price, asserting that the company will continue to resolve REO and legacy positions, demonstrating the true value in 2026.

Timothy D'Agostino from B. Riley Securities asked about the momentum of FBRT's Fannie Mae multifamily business in early 2026, following strong 2025 volumes, and the outlook for that channel. He also inquired about the persistence of high loan repayments in the portfolio and whether most repayments are now behind the company.

Answer

CEO Michael Comparato explained that the multifamily business is highly sensitive to interest rates, with even small movements in the 10-year Treasury significantly impacting market volume. Regarding repayments, he noted that FBRT is actively cycling through its legacy portfolio, with only 32% now considered backward-looking, and expressed confidence that the market is mispricing FBRT due to a disconnect between book value and share price, which he expects to address in 2026.

Timothy D'Agostino asked about the quarter-over-quarter decrease in net interest income, specifically a $3.5 million lower top-line interest income, and whether this was attributable to SOFR fluctuations or loans written in Q4 being funded in Q1.

Answer

Brian Harris, CEO of Ladder Capital Corp, explained that loan originations can be lumpy, with many Q4 loans funded late in December, which impacted Q4 net interest income but would benefit Q1. He also noted that while loan payoffs were slowing, they tended to be higher-rate loans, and securities book payoffs were picking up, providing liquidity for new, higher-yielding loan originations.

Timothy D'Agostino asked about the quarter-over-quarter decline in net interest income, specifically a $3.5 million lower top-line interest income, and if it was attributable to loans funded in Q4 being recognized in Q1.

Answer

Brian Harris (CEO, Ladder Capital Corp) explained that net interest income can be lumpy, confirming that many Q4 loans were funded late in December, delaying NII recognition to Q1 2026. He also noted that payoffs, though modest in Q4, tend to be higher-rate loans, contributing to a slight dip in spread. Harris highlighted strong Q1 2026 originations and anticipated continued growth as cash from unsecured lines and securities sales funds new, higher-yielding loans, with securities payoffs accelerating as expected.

Timothy D'Agostino inquired about new geographic markets within the southern U.S. that Sunrise Realty Trust is targeting for pipeline assets and which of these regions offer the most attractive investment opportunities.

Answer

Brian Sedrish, CEO, confirmed the continued focus on the southern U.S., specifically mentioning Florida, Texas, the Carolinas (North Carolina), Georgia, and Tennessee as primary markets. He noted that Texas, Florida, the Carolinas, and Tennessee continue to present interesting pockets for investment, with no significant shift from historical attractiveness.

Timothy D'Agostino inquired about Sunrise Realty Trust's expanding presence across the southern United States, specifically asking about new geographies within the region that are appearing in the investment pipeline and which of these geographies are most attractive for investment.

Answer

Brian Sedrish, CEO of Sunrise Realty Trust, confirmed that the company remains focused on the southern U.S., with primary markets including Florida, Texas, North Carolina, Georgia, and Tennessee. He noted that Texas and Florida continue to offer interesting pockets, while the Carolinas and Tennessee also remain attractive, with deal flow allowing continued focus on these areas.

Timothy D'Agostino, on behalf of Randy Binner from B. Riley Securities, inquired about the company's perspective on M&A activity within the mortgage servicing sector, especially in contrast to recent origination-focused transactions in the industry.

Answer

CEO, President & Chair Glen Messina responded that M&A in the servicing sector is a trade-off against acquiring assets in the bulk market. He suggested that as long as the bulk MSR market remains robust, it will be the preferred channel for growth. However, if that supply diminishes while demand for servicing assets remains high, M&A activity on the servicing side could increase.

Tim D'Agostino, on behalf of Randy Binner, asked about the anticipated quarterly pace of capital deployment and the specific asset classes being targeted for investment.

Answer

Michael Nierenberg, Chairman, President & CEO, stated that the target assets remain retail, multifamily, office, and industrial properties, along with SRT deals. He noted the company has approximately $100 million in liquidity and projects deploying about $50 million in the third quarter. For future capital needs, he indicated a preference for tapping the preferred stock market to avoid diluting common shareholders.

Timothy D'Agostino of B. Riley Securities, on behalf of Randy Binner, asked for management's perspective on the potential impact of Government-Sponsored Enterprise (GSE) reform on NYMT's business and the broader mortgage market.

Answer

CEO Jason Serrano explained that NYMT's credit investments are primarily outside the GSE landscape. He stated that while significant GSE reform could increase mortgage rates, he does not see it as a near- or medium-term risk, noting the transition would likely take years and is not expected under the current or a potential new administration.