ABR plummets: Margin compression triggers 12.64% drop—is the $8.02 crash inevitable?

Drew Dosek Verified Investing

Arbor Realty Trust (ABR), a nationwide real estate investment trust specializing in commercial and multifamily loans, reported disastrous earnings on Friday, October 31st. While the REIT did beat earnings per share by 50.90%, it missed badly on revenue, falling short by a significant 27.23%.

The market immediately blamed the margin compression, which was caused by an increase in delinquent and modified loans. This news sent the stock plunging 12.64% on the day.

Looking at the technical damage, the price finished Friday off the intraday lows of $9.61 at $10.09. Critically, the stock is currently resting right on the major technical support level at $10.01. This is the immediate pivot to watch. If bulls can maintain this floor, the first resistance target to re-attack is located at $11.44.

The issue is that the significant support levels below are much further down. If the $10.01 floor fails, the next major line of defense doesn't arrive until the COVID-lows inclining trendline at $8.94. Beyond that, there is minor support at the daily bottoming tail from May at $8.43, followed by the ultimate downside risk: the long-term declining trendline at approximately $8.02. This is a high-stakes battle for $10.01—its defense is mandatory to avoid a steep technical collapse.

Author

Drew Dosek

Verified Investing

Passionate technical and cycle analyst committed to empowering traders through data-driven insights.

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