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While mortgage rates have remained at historical lows, REITs have continued to produce steady dividend income - with many offering yields in the double digits - as well as growth for their investors. Given that it is unlikely that interest rates will rise dramatically over the next two years, REITs are estimated to continue in positive territory over the long term.

In this article, I will show why ARMOUR Residential REIT, Inc. (NYSE:ARR) will continue its forward growth and dividend yield momentum through at least 2014, even with a potential change in management style from the company's new CFO.

ARMOUR's Strong Points

As with a number of other REITs, ARMOUR has been generating a double-digit dividend yield - over 17% - thanks to its monthly per share dividend of $0.10. Taxable income has also been strong, with $47 million reported for the first quarter of 2012, and almost $57 million in the second quarter. Given this, it appears that ARMOUR is in a good position to continue on this strong dividend path.

One big upcoming change for the company will be when current CFO Jeff Zimmer steps down and is replaced by James Mountain, currently an industry professional practice director for Deloitte. Mountain comes with over 25 years of experience on securitization transactions. While any change in management style remains to be seen, the move is looked upon as being positive for ARMOUR.

The company currently holds a market cap of $1.74 billion. With its P/E ratio of 53.2, ARMOUR stands far above the average real estate industry P/E ratio of just under 17, as well above the overall S&P 500 P/E ratio of 17.7.

ARMOUR recently announced that it has priced an underwritten public offering of 55 million shares of common stock. The company plans to use the net proceeds from this offering to purchase additional agency securities as market conditions warrant. This could put the company in an even stronger position to continue making - and possibly raising - its dividend payment to its investors.

Where Other REITs Stand

Low mortgage rates have prompted a number of REITs to continue gathering income producing investments and passing nice solid dividend income along to their investors. CYS Investments (NYSE:CYS), is one such REIT. With its $.50 per share quarterly dividend, this $2 per share annual dividend payment allows investors to receive a yield of 14%.

In the company's second quarter 2012 financials, it was stated that core earnings were just shy of $45 million, giving CYS a net asset value per share of $13.52 per. The REIT also generated $.49165 in net interest income per share in the second quarter 2012.

In mid-July 2012, CYS completed an underwritten public offering of 46 million additional common shares, at a price of $13.70 per share, raising over $620 million that will be used to purchase Agency RMBS and interest rate swaps and caps. The company also announced that it would be underwriting a public offering of 3 million shares of its 7.75% Series A Cumulative Redeemable Preferred Stock, with these shares priced at $25 per. Proceeds from this offering will also be used for purchasing agency RMBS.

American Capital Agency (NASDAQ:AGNC) has also posted a strong performance throughout 2012. In the first quarter alone, the company issued 76 million new common shares in a secondary offering, and the REIT generated $1.695 in net interest income per share, versus $1.54 during the same quarter of 2011. American Capital has the potential to produce double-digit growth and has provided investors with one year annualized returns of 23%.

While the news is exceedingly good for some REITs in this sector, there are a couple that investors may want to be a bit more cautious about. One such REIT is Annaly Capital Management (NYSE:NLY). Although the company provides a current dividend yield of 13% and annualized returns of 18%, its potentially high prepayment exposure could have a negative effect. Recently, due in large part to this potential exposure, the company's shares were downgraded to "underperform" by FBR Capital Markets.

Another REIT that may produce just so-so performance going forward is Chimera Investments (NYSE:CIM). Even though the company is currently generating a 20% dividend yield, its earnings per share estimate for 2013 is $0.45, which is slightly lower than 2012's estimated $0.47. With this in mind, investors should use caution before adding - or adding to - these shares. An even bigger potential negative here, though, is the fact that the company hasn't provided any hard information regarding earnings since the first quarter of 2011. At that time, earnings were progressively decreasing, alluding to the possibility of lowering the company's dividend payout, or even halting it altogether.

The Bottom Line

With market conditions still ripe for REITs to continue making purchases, I feel that ARMOUR is on track to continue rewarding investors with a strong and secure dividend yield, along with decent gains. Although the company will soon see changes at the top, it is likely that this will have only a minor effect - if any - on the company's earnings momentum going forward.

ARMOUR's P/E ratio stands far above that of the overall real estate sector, as well as the S&P 500. With the additional cash generated from the company's upcoming 50 million common share offering, it is likely that ARMOUR will further lock in profits and cash flow for both the short- and long-term.

Source: Armour Residential REIT Will Maintain A Big Dividend Through 2014