10-Q · May 15, 2026
Lument Finance Trust (LFT) faced significant operational challenges in Q1 of 2026, reporting a net loss of $978.4K or $0.02 per share, disappointing the market expectations of $0.06 EPS. Revenue dropped to $5.7 million,…
Earnings analysis · 10-Q
LFT earnings analysis
Filed August 13, 2026 · Our reading of the company's report
The latest report
LFT's Q2 2026 results deteriorated materially: net interest income declined to $4,502,730 from $5,696,678 in Q1, while net loss attributable to common stockholders widened to $9,197,948, or $(0.18) per share, from…
Read full summary
LFT's Q2 2026 results deteriorated materially: net interest income declined to $4,502,730 from $5,696,678 in Q1, while net loss attributable to common stockholders widened to $9,197,948, or $(0.18) per share, from $(0.02). Credit costs were the primary headwind, with an $8,625,695 provision and a $21,248,582 allowance, alongside defaults, foreclosures and lower book value of $2.76 per share versus $3.03 at year-end. Liquidity improved to $29.0 million of unrestricted cash, and management expects short-term liquidity to be sufficient, but 4.4:1 GAAP debt-to-equity, amended coverage covenants and the new NYSE deficiency create substantial risks.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $-0.18
What stood out
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Net interest income declined sequentially
Q2 2026 net interest income was $4,502,730, down from $5,696,678 in Q1 2026. The decline reflected lower loan balances, reduced exit and extension fees, and a $0.4 million increase in non-performing-loan interest reduction.
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Loss widened sharply in Q2
Q2 2026 net loss attributable to common stockholders was $9,197,948, or $(0.18) per diluted share, versus a $978,375 loss, or $(0.02) per share, in Q1 2026.
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New originations offset by heavy payoffs
The company acquired or originated four loans totaling $67.0 million and three funded advances totaling $24.0 million, while experiencing $184.0 million of loan payoffs during Q2 2026.
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Portfolio remains floating-rate and multifamily-focused
The senior loan portfolio was $991.7 million at June 30, 2026, with 100.0% floating-rate exposure and a 3.30% average spread to 30-day SOFR. Multifamily assets represented 91.7% of the portfolio.
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Liquidity position improved
Unrestricted cash and cash equivalents increased to $29.0 million from $23.1 million at December 31, 2025. Cash, cash equivalents and restricted cash increased $28.1 million during the first six months of 2026.
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Dividend maintained despite lower book value
Book value of common stock was $144.7 million, or $2.76 per share, versus $158.99 million and $3.03 per share at December 31, 2025. The company declared a Q2 common dividend of $0.04 per share.
What to watch
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Credit loss provisions surged
The Q2 provision for credit losses was $8,625,695, versus a $732,373 release in Q1, primarily from two loans moving to risk rating 5, additional reserves and revised macroeconomic assumptions. The allowance for credit losses was $21,248,582 at June 30, 2026.
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Defaults and foreclosures remain elevated
Only 93.1% of commercial mortgage loans were current as to principal and interest at June 30, 2026. The portfolio included six risk-rated-5 loans with aggregate outstanding principal of $98.1 million, and the company foreclosed on loans in Colorado Springs and Arlington with an aggregate net carrying value of $25.2 million during the first six months.
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High leverage and financing exposure
Total debt to equity was 4.4:1 on a GAAP basis, while consolidated non-recourse CLO liabilities had a carrying value of $784.6 million. The company also had $248.3 million outstanding under a mark-to-market repurchase agreement and $24.7 million under a secured lending agreement.
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New NYSE minimum-price deficiency
The company received an NYSE deficiency notice because its average closing price was below $1.00 for 30 consecutive trading days. It plans a 1-for-10 reverse stock split, expected to reduce shares from approximately 52.5 million to 5.2 million, but stated there is no assurance it will regain compliance.
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Lenders amended coverage covenants
On August 12, 2026, the company amended the minimum interest coverage ratio for periods ending June 30, September 30 and December 31, 2026 and March 31, 2027 under both the JPMorgan guarantee and secured term-loan credit agreements. The company reported compliance with covenants as of June 30, 2026.
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Operating cash flow weakened
First-half 2026 operating cash flow was reported as $4,072,101 in the cash-flow table, while management's discussion describes net cash provided by operating activities of $3.6 million, down from $7.7 million in the prior-year period. Financing activities used $95.9 million, including $169.7 million of LMF 2023-1 debt repayment.
Management's outlook
No numeric revenue or EPS guidance was provided. Management stated that cash flow from operations and available borrowing capacity are expected to be sufficient for anticipated short-term liquidity requirements of one year or less, including investment activity, distributions and corporate expenses.
Earlier filings 4
10-K · March 23, 2026
Lument Finance Trust (LFT) is a REIT focused on transitional floating-rate CRE mortgage loans (primarily middle‑market multifamily). The 2025 10‑K shows a $1.14B loan book (61 loans) with a weighted average coupon of…
10-Q · November 12, 2025
Lument Finance Trust reported Q3 2025 net interest income of $5,051,462 and diluted EPS of $0.01, materially below the prior-year quarter (net interest income $9,484,463; EPS $0.10). The company reduced its balance…
10-Q · August 8, 2025
Lument Finance Trust reported Q2 2025 net interest income of $6,960,779 and GAAP net income of $3,690,773 (net income attributable to common stockholders $2,505,731; EPS $0.05). Revenue and earnings declined materially…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.