Annaly Capital Management Stock Continues Downward Trend
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 day ago
0mins
Source: seekingalpha
- Poor Stock Performance: Annaly Capital Management's stock has declined nearly 5% over the past month and is down 4.87% year-to-date, significantly underperforming the S&P 500's 8.43% gain, indicating weakness in its market position.
- Earnings Beat Expectations: Despite the stock decline, the company reported stronger-than-expected Q1 results on April 21, with earnings available for distribution at $0.76 per share, surpassing Wall Street's $0.74 estimate and rising from $0.74 in Q4, highlighting growth potential in its non-agency business.
- Portfolio Expansion: Annaly expanded its residential credit portfolio by 30% to $10.3 billion and increased its mortgage servicing rights portfolio by 9% to $4.2 billion, demonstrating a proactive strategy in diversifying its investments.
- Optimistic Future Outlook: CEO David Finkelstein stated that Annaly is positioned for “attractive risk-adjusted returns” through 2026, focusing on growth in residential credit and mortgage servicing rights, although analysts currently rate the stock as a Hold, reflecting cautious sentiment about its future performance.
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Analyst Views on NLY
Wall Street analysts forecast NLY stock price to rise
8 Analyst Rating
6 Buy
2 Hold
0 Sell
Strong Buy
Current: 21.630
Low
21.50
Averages
23.09
High
25.00
Current: 21.630
Low
21.50
Averages
23.09
High
25.00
About NLY
Annaly Capital Management, Inc. is a diversified capital manager with investment strategies across mortgage finance. It owns a portfolio of real estate related investments, including mortgage pass-through certificates, collateralized mortgage obligations, credit risk transfer (CRT) securities, and other securities representing interests in or obligations backed by pools of mortgage loans, residential mortgage loans and mortgage servicing rights. Its investment groups include Annaly Agency Group, Annaly Residential Credit Group, and Annaly Mortgage Servicing Rights Group. Annaly Agency Group invests in agency mortgage-backed securities collateralized by residential mortgages. Annaly Residential Credit Group invests in non-agency residential mortgage assets within residential and commercial markets. Annaly Mortgage Servicing Rights Group invests in MSR, which provides the right to service residential mortgage loans in exchange for a portion of the interest payments made on the loans.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Annaly Capital: A Giant REIT's Investment and Dividend Outlook
- Portfolio Size: Annaly Capital's total investment portfolio reached $106.7 billion, increasing by $2 billion from the end of last year, with $92.2 billion in government-backed mortgage securities, highlighting its strong position in the mortgage market.
- Capital Raising Ability: In the first quarter, Annaly successfully raised $509 million in capital, primarily for residential credit and mortgage servicing rights investments, demonstrating its effective financing capability and investment strategy in the market.
- Book Value Per Share: As of the end of the first quarter, Annaly's book value per share was $19.82, below the market price of $21.50, reflecting investor recognition of its quality portfolio despite a decline in book value.
- Dividend Sustainability: Annaly's earnings available for distribution (EAD) stood at $0.76 per share, exceeding the $0.70 dividend, with EAD growing over the past year, supporting nearly an 8% increase in dividends, indicating the safety and sustainability of its dividend.
See More
Annaly Capital Management Stock Continues Downward Trend
- Poor Stock Performance: Annaly Capital Management's stock has declined nearly 5% over the past month and is down 4.87% year-to-date, significantly underperforming the S&P 500's 8.43% gain, indicating weakness in its market position.
- Earnings Beat Expectations: Despite the stock decline, the company reported stronger-than-expected Q1 results on April 21, with earnings available for distribution at $0.76 per share, surpassing Wall Street's $0.74 estimate and rising from $0.74 in Q4, highlighting growth potential in its non-agency business.
- Portfolio Expansion: Annaly expanded its residential credit portfolio by 30% to $10.3 billion and increased its mortgage servicing rights portfolio by 9% to $4.2 billion, demonstrating a proactive strategy in diversifying its investments.
- Optimistic Future Outlook: CEO David Finkelstein stated that Annaly is positioned for “attractive risk-adjusted returns” through 2026, focusing on growth in residential credit and mortgage servicing rights, although analysts currently rate the stock as a Hold, reflecting cautious sentiment about its future performance.
See More
Annaly Capital Management Performance Analysis
- High Dividend Yield: Annaly Capital's dividend yield stands at approximately 13%, significantly higher than the S&P 500's 1.1%, indicating its attractiveness in the market, even as its stock trades above book value, it continues to draw investor interest.
- Portfolio Growth: As of the first quarter, Annaly's total investment portfolio reached $106.7 billion, an increase of $2 billion from the end of last year, with $92.2 billion in government-backed mortgage securities, showcasing its strong position in the mortgage market.
- Capital Raising Ability: The company successfully raised $509 million in capital during the first quarter, primarily for residential credit and mortgage servicing rights investments, demonstrating its effective capital management by leveraging its stock price premium.
- Improved Profitability: Annaly's earnings available for distribution (EAD) was $0.76 per share, exceeding the $0.70 dividend, and showing growth from the previous year, indicating enhanced profitability and sustainability of its dividend.
See More
Strategies for Generating Income with Real Estate Investment Trusts
- Capital Requirement Analysis: To achieve an annual retirement income of $50,000, investors need approximately $1.11 million in capital, with half sourced from traditional dividend stocks and the other half from real estate investments, significantly impacting income performance over the next two decades.
- Yield Tier Breakdown: Conservative investors require about $1.43 million in capital to achieve a 3% to 4% yield, while a moderate 5.5% yield necessitates around $909,091, illustrating how different yield tiers directly influence capital needs.
- Tax Implications for REITs: REIT distributions are typically taxed as ordinary income, but the Section 199A deduction allows investors to deduct 20% of eligible REIT dividends, effectively lowering the tax rate to approximately 17.6%, which is crucial for enhancing after-tax income.
- Diversification Investment Advice: Investors are advised to diversify their REIT investments across subsectors to mitigate concentration risk, especially in the current environment where the 10-year Treasury yield stands at 4.59%, significantly increasing risks associated with any single REIT category.
See More
UBS Increases Target Price for Annaly Capital Management Inc. to $23 from $22.5
- Analyst Update: UBS has raised its target price for a specific asset from $22.5 to $23.
- Market Implications: This adjustment reflects UBS's positive outlook on the asset's performance in the market.
See More
Annaly Capital Management Q1 2026 Earnings Call Insights
- Economic Return Performance: Annaly achieved an economic return of 1.5% in Q1 2026, reflecting the strength of its diversified housing finance platform amidst challenges posed by geopolitical tensions and inflationary pressures.
- Capital Allocation Optimization: The company raised approximately $510 million through ATM financing, primarily allocated to Residential Credit and MSR, increasing their combined capital allocation from 38% to 44%, indicating a proactive approach to future growth.
- Loan and Securitization Activity: During the quarter, Annaly acquired $6.7 billion in whole loans, with lock volume reaching $7.4 billion, a 16% quarter-over-quarter and 41% year-over-year increase, while completing 8 securitizations totaling $4.7 billion, showcasing robust market demand.
- Asset and Liability Status: As of March 31, 2026, the company's book value per share decreased by 1.9% to $19.82, yet earnings available for distribution per share increased by $0.02 to $0.76, exceeding the quarterly dividend, demonstrating resilience in a challenging environment.
See More
Annaly Capital: A Giant REIT's Investment and Dividend Outlook
- Portfolio Size: Annaly Capital's total investment portfolio reached $106.7 billion, increasing by $2 billion from the end of last year, with $92.2 billion in government-backed mortgage securities, highlighting its strong position in the mortgage market.
- Capital Raising Ability: In the first quarter, Annaly successfully raised $509 million in capital, primarily for residential credit and mortgage servicing rights investments, demonstrating its effective financing capability and investment strategy in the market.
- Book Value Per Share: As of the end of the first quarter, Annaly's book value per share was $19.82, below the market price of $21.50, reflecting investor recognition of its quality portfolio despite a decline in book value.
- Dividend Sustainability: Annaly's earnings available for distribution (EAD) stood at $0.76 per share, exceeding the $0.70 dividend, with EAD growing over the past year, supporting nearly an 8% increase in dividends, indicating the safety and sustainability of its dividend.
See More
Annaly Capital Management Stock Continues Downward Trend
- Poor Stock Performance: Annaly Capital Management's stock has declined nearly 5% over the past month and is down 4.87% year-to-date, significantly underperforming the S&P 500's 8.43% gain, indicating weakness in its market position.
- Earnings Beat Expectations: Despite the stock decline, the company reported stronger-than-expected Q1 results on April 21, with earnings available for distribution at $0.76 per share, surpassing Wall Street's $0.74 estimate and rising from $0.74 in Q4, highlighting growth potential in its non-agency business.
- Portfolio Expansion: Annaly expanded its residential credit portfolio by 30% to $10.3 billion and increased its mortgage servicing rights portfolio by 9% to $4.2 billion, demonstrating a proactive strategy in diversifying its investments.
- Optimistic Future Outlook: CEO David Finkelstein stated that Annaly is positioned for “attractive risk-adjusted returns” through 2026, focusing on growth in residential credit and mortgage servicing rights, although analysts currently rate the stock as a Hold, reflecting cautious sentiment about its future performance.
See More
Annaly Capital Management Performance Analysis
- High Dividend Yield: Annaly Capital's dividend yield stands at approximately 13%, significantly higher than the S&P 500's 1.1%, indicating its attractiveness in the market, even as its stock trades above book value, it continues to draw investor interest.
- Portfolio Growth: As of the first quarter, Annaly's total investment portfolio reached $106.7 billion, an increase of $2 billion from the end of last year, with $92.2 billion in government-backed mortgage securities, showcasing its strong position in the mortgage market.
- Capital Raising Ability: The company successfully raised $509 million in capital during the first quarter, primarily for residential credit and mortgage servicing rights investments, demonstrating its effective capital management by leveraging its stock price premium.
- Improved Profitability: Annaly's earnings available for distribution (EAD) was $0.76 per share, exceeding the $0.70 dividend, and showing growth from the previous year, indicating enhanced profitability and sustainability of its dividend.
See More
Strategies for Generating Income with Real Estate Investment Trusts
- Capital Requirement Analysis: To achieve an annual retirement income of $50,000, investors need approximately $1.11 million in capital, with half sourced from traditional dividend stocks and the other half from real estate investments, significantly impacting income performance over the next two decades.
- Yield Tier Breakdown: Conservative investors require about $1.43 million in capital to achieve a 3% to 4% yield, while a moderate 5.5% yield necessitates around $909,091, illustrating how different yield tiers directly influence capital needs.
- Tax Implications for REITs: REIT distributions are typically taxed as ordinary income, but the Section 199A deduction allows investors to deduct 20% of eligible REIT dividends, effectively lowering the tax rate to approximately 17.6%, which is crucial for enhancing after-tax income.
- Diversification Investment Advice: Investors are advised to diversify their REIT investments across subsectors to mitigate concentration risk, especially in the current environment where the 10-year Treasury yield stands at 4.59%, significantly increasing risks associated with any single REIT category.
See More
UBS Increases Target Price for Annaly Capital Management Inc. to $23 from $22.5
- Analyst Update: UBS has raised its target price for a specific asset from $22.5 to $23.
- Market Implications: This adjustment reflects UBS's positive outlook on the asset's performance in the market.
See More
Annaly Capital Management Q1 2026 Earnings Call Insights
- Economic Return Performance: Annaly achieved an economic return of 1.5% in Q1 2026, reflecting the strength of its diversified housing finance platform amidst challenges posed by geopolitical tensions and inflationary pressures.
- Capital Allocation Optimization: The company raised approximately $510 million through ATM financing, primarily allocated to Residential Credit and MSR, increasing their combined capital allocation from 38% to 44%, indicating a proactive approach to future growth.
- Loan and Securitization Activity: During the quarter, Annaly acquired $6.7 billion in whole loans, with lock volume reaching $7.4 billion, a 16% quarter-over-quarter and 41% year-over-year increase, while completing 8 securitizations totaling $4.7 billion, showcasing robust market demand.
- Asset and Liability Status: As of March 31, 2026, the company's book value per share decreased by 1.9% to $19.82, yet earnings available for distribution per share increased by $0.02 to $0.76, exceeding the quarterly dividend, demonstrating resilience in a challenging environment.
See More
