Arbor Realty Trust, Inc. — financial distress indicators
Financial-health summary
Arbor Realty Trust, Inc.'s reported numbers place it in the 'Weak' financial-health band (distress score 56/100). The main indicators are operating profit does not cover interest, market-implied default probability >20% and very high leverage. Independently, the market-implied (Merton) default probability is 99.8%. In its favour: operating cash flow is positive over the latest 12 months.
Stress by dimension
Share price — last 12 months
Indicators behind the score
Each red flag shows the evidence from the company’s own filings and the financial or legal principle behind it. Points add to the 0–100 score.
Interest coverage (EBIT / interest) is 0.33×.
When EBIT < interest, debt service is funded from cash reserves or new borrowing — the classic precursor to payment default and covenant breach.
Merton distance-to-default -2.93 σ → PD 100%.
Structural (Merton/KMV) model: equity is a call option on assets; low distance-to-default means assets are close to the default point.
Total debt is 29.2× EBITDA.
Debt above ~6× EBITDA is deep sub-investment-grade territory; refinancing becomes difficult when rates or earnings move against the company.
Revenue changed -20% year over year.
Falling sales reduce cash available for debt service.
Price is -72% from its 52-week high.
For financial firms a share-price run often precedes a deposit or funding run (confidence channel).
0 severe and 1 moderate distress-related headlines in the last 6 months.
Headlines are corroborating evidence only; they are weighted lightly and never drive a flag alone.
Revenue vs net income
Cash generation
Debt vs cash vs equity
✅ Mitigating factors
- Operating cash flow is positive over the latest 12 months.
📰 Recent news scan
- downgradeWhy Arbor Realty Trust (ABR) Stock Is Falling TodayYahoo Finance · 2026-09-29
- 1 Safe-and-Steady Stock with Competitive Advantages and 2 We Turn DownYahoo Finance · 2026-10-06
- Arbor Realty Trust (ABR) Stock Dips While Market Gains: Key FactsYahoo Finance · 2026-10-05
- Arbor Realty Trust Declares Preferred Stock DividendsYahoo Finance · 2026-10-05
- Investors Heavily Search Arbor Realty Trust (ABR): Here is What You Need to KnowYahoo Finance · 2026-10-02
- Arbor Realty Trust (ABR) Dips More Than Broader Market: What You Should KnowYahoo Finance · 2026-09-29
⚖️ U.S. legal pathway — Title 11, U.S. Code
Which chapter would apply?
- Chapter 11 — reorganisation. Management usually stays in control as debtor-in-possession; the automatic stay (§362) halts collection; a plan must meet the best-interests test (§1129(a)(7)) and the absolute priority rule (§1129(b)) — creditors are paid before shareholders, who are frequently wiped out.
- Chapter 7 — liquidation. A trustee sells assets and distributes proceeds by statutory priority (§§507, 726).
- Subchapter V (“Chapter 5”) is a fast track for small-business debtors under a statutory debt cap, but SEC-reporting companies are excluded (§101(51D)) — so it rarely applies to listed companies.
What typically triggers a filing
- Payment default or covenant breach lenders will not waive; a debt maturity that cannot be refinanced.
- Auditor going-concern doubt (ASC 205-40 / PCAOB AS 2415) — often itself a default trigger in loan agreements.
- Creditors can force a case with an involuntary petition (§303) if debts are not paid as they come due.
- Delisting after sustained sub-$1 prices or equity deficits cuts off equity funding.
Transactions shortly before filing can be clawed back (preferences — 90 days, §547; fraudulent transfers — 2 years, §548).
Frequently asked questions
What do Arbor Realty Trust, Inc.'s financial-health indicators show?
As of 2026-10-08, Arbor Realty Trust, Inc.'s public financial data places it in the 'Weak' band with a distress score of 56/100, driven by operating profit does not cover interest, market-implied default probability >20% and very high leverage. This is a statistical screen of reported numbers — it does not mean the company is insolvent, has defaulted or will enter insolvency proceedings.
What is Arbor Realty Trust, Inc.'s financial distress score?
56/100 ('Weak'). Merton distance-to-default -2.93 σ (model default probability 99.8%).
What works in Arbor Realty Trust, Inc.'s favour?
Operating cash flow is positive over the latest 12 months.
How are shareholders treated if a company enters insolvency?
In a Chapter 11 reorganisation the absolute priority rule pays secured lenders, then unsecured creditors, before shareholders — so existing shares are usually cancelled or heavily diluted. In Chapter 7 the company is liquidated and shareholders rarely recover anything.
Other Real Estate Cos & REITs companies with distress indicators
- American Strategic Investment Co. (NYC)Very weak 100/100
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- Change Agents Corporation (CHGA)Very weak 99/100
- EUDA Health Holdings Limited (EUDA)Very weak 97/100
- Ashford Hospitality Trust, Inc. (AHT)Very weak 93/100
- Murano Global Investments Plc (MRNO)Very weak 88/100
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Methodology
Score = capped sum of rule-based red flags across seven dimensions (liquidity, solvency, profitability, cash flow, sales trend, market signal, news). Ohlson O-score (1980) gives an accounting-based 1-year failure probability; Merton distance-to-default (Bharath & Shumway 2008) gives a market-implied probability. Financial institutions use a capital-based rule set. Recalculated every trading day from the latest filings, prices and news.