AGNC Investment: Dividend Yield And Safety In Focus

Dec. 29, 2021 1:05 AM ETAGNC Investment Corp. (AGNC)30 Comments


  • With a 9.3% dividend yield, AGNC Investment Corp appears attractive to many income-oriented investors, especially under a low-rate environment.
  • Its dividend coverage is at a very safe and comforting level by payout ratio.
  • However, you should be aware that its dividend yield is far below the historical average and its dividend cushion ratio is also below the historical average.
  • And also be aware of the implications of the Fed tapering and anticipated interest rate raises.

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Thesis and Background

You may find the 9.3% dividend yield from AGNC Investment Corp (NASDAQ:AGNC) attractive – for very good reasons. Just to name a few: first, we are in a secular interest rate environment, and the 10-year Treasury bond

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** Disclosure** I am associated with Envision Research

I am an economist by training, with a focus on financial economics. After I completed my PhD, I have been professionally working as a quantitative modeler, with a focus on the mortgage market, commercial market, and the banking industry for more than a decade. And at the same time, I have been managing several investment accounts for my family for the past 15 years, going through two market crashes and an incredible long bull market in between. 

My writing interests are mostly asset allocation and ETFs, particularly those related to the overall market, bonds, banking and financial sectors, and housing markets. I have been a long time SA reader, and am excited to become a more active participator in this wonderful community! 

Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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