ARMOUR Residential REIT, Inc.(NYSE: ARR )

ARMOUR Residential REIT, Inc. (ARR), formerly Enterprise Acquisition Corp., is focused on investing in Agency residential mortgage-backed securities. ARMOUR’s residential mortgage-backed securities portfolio consists of hybrid adjustable-rate, adjustable-rate and fixed-rate residential mortgage-backed securities issued or guaranteed by the United States Government-chartered entities, including the Federal National Mortgage Association (Fannie Mae), the Federal Home Loan Mortgage Corporation (Freddie Mac) and the Government National Mortgage Administration, a United States Governm ent corporation (Ginnie Mae) (collectively, Agency securities).

Mortgage Real Estate Investment Trusts have been in a downtrend with the market, even though they provide some of the biggest dividend yields available. Recent data indicates that there is no wave of refinancings and that the mREIT stocks are oversold, bargain hunters, and income investors should be coming into the sector. ARR is one of real estate investment trusts (REITs) that could rebound soon.

ARR trades for a premium of about 2% to book value, but offers a very high yield at nearly 20%. It will trade ex-dividend, for its monthly dividend of $0.12, payable on 9/29/11. As a percentage of ARR’s recent stock price of $7.43, this dividend works out to approximately 1.61%.

In last tradind day, ARMOUR Residential REIT Inc. shares were up about 0.27% , to close at $7.43 and its traded volume was 3,431,177. It has 52-week low of $6.80 and high of $8.33. It has an ongoing P/E of 8.98, which indicates that it seems undervalued. It is rated strong buy by stoxline.com and it has a price target of $8.90 in six months.

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