10 Most Undervalued REIT Stocks to Buy Right Now

4. ARMOUR Residential REIT, Inc. (NYSE:ARR)

Forward P/E Ratio: 5.74

Number of Hedge Fund Holders: 19

ARMOUR Residential REIT, Inc. (NYSE:ARR) ranks among the most undervalued REIT stocks to buy right now. On January 16, Jones Trading raised ARMOUR Residential REIT, Inc. (NYSE:ARR) from Hold to Buy, with a $20.50 price target. The upward revision was based on a predicted growth in book value, which Jones Trading believes suggests that the shares are discounted when compared to agency rivals.

The firm expects that ARMOUR’s book value will reach $19.50 per share by January 15, a rise from $17.49 on September 30. Jones Trading believes the stock is trading at 0.97x projected book value per share, which puts it near the low end of the agency mortgage REIT peer standard.

Similarly, Compass Point began coverage of ARMOUR Residential REIT, Inc. (NYSE:ARR) with a Buy rating in mid-December, pointing to wider-than-average mortgage spreads as a key driver of potential book value per share expansion, and expects these spreads to narrow as fixed income volatility falls and the yield curve becomes steeper.

ARMOUR Residential REIT, Inc. (NYSE:ARR) is a Maryland-based company founded in 2008. It invests primarily in residential mortgage-backed securities issued or guaranteed by US government-sponsored entities.