Having declined by greater than 54% since its peak attained in mid-2021, I see AGNC’s latest substantial-dividend generate as a reflection of undervaluation rather then a possible earnings lure.

provided the constructive source-demand from customers dynamic for company MBS click here plus the improved financial policy outlook, the two the existing returns and long run prospects for AGNC appear favorable.

This sector landscape also resulted in a damaging spread between 2Y premiums and 30Y charges since the center of 2022, that are the premiums which might be regarded as improved proxies for funding and asset premiums for mREITs, exhibiting which the investment environment for AGNC and its friends was really unfavorable since the beginning of 2022.

Falling interest costs may be a potential tailwind for AGNC. The company has become in a position to invest in newer assets at higher yields, and slipping fees could give its e-book price an additional Raise.

contemplating the benefits and drawbacks of AGNC, we will conclude that buyers must refrain from speeding to acquire AGNC right now, just banking on its worthwhile dividend.

For anyone who is using your dividends to pay for living costs, this is almost the worst doable graph you could ever see. Investors ended up with fewer income and fewer funds.

AGNC's company product is delicate to interest fee adjustments, but its hedging coverage and opportunity rate cuts enable it to be a sexy investment.

CEO Peter Federico talked over the factors weighing on its results in the earnings press release. He said, "The robust mounted money sector momentum that began inside the fourth quarter of 2023 abated in the next quarter, given that the Federal Reserve and marketplace individuals analyzed economic knowledge for indications which the financial system was slowing and inflation moderating.

AGNC Investment’s inventory presently pays a fourteen% produce, and I'm including to my lengthy situation incrementally.

AGNC works by using leverage to take a position in securities backed by household mortgages. The principal and desire payments on these home loans are guaranteed by U.

I believe it is a main purpose why AGNC’s share value has outperformed its peer because its bottom at the end of very last Oct, a craze that is likely to maintain more than the approaching months.

But think about the blue line, which happens to be the dividend payment. it's been slipping steadily for years. The yield has only remained superior as the inventory rate, the purple line, has actually been falling together with the dividend.

To finance these purchases, the company borrows largely while in the repo market place, which means its funding is a lot more practical to quick-expression interest fees.

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