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AGNC Investment Is A Buy Below Book Value Per Share
Summary
- AGNC Investment has managed to maintain its dividend during the current Fed tightening cycle, unlike most mortgage REITs.
- Widening mortgage backed security (MBS) spreads have been a major issue for mortgage REITs, leading to declining book value per share.
- AGNC Investment is trading at a slight discount to book value per share and is expected to benefit from a decrease in interest rate volatility and tightening MBS spreads.
Brent Nyitray, CFA is the author of The Daily Tearsheet: https://thedailytearsheet.com/ which is a blog covering economics, real estate and the mortgage space. He also has a Substack column called The Weekly Tearsheet: https://weeklytearsheet.substack.com/. Brent Nyitray, CFA has been in the investment business for over 20 years, working for event-driven funds like Elliott Management, Mallet Capital, and Dellacamera Capital Management. His area of expertise is in event-driven situation, merger arbitrage, and deep value investing. He covered the REIT space and homebuilders for Market Realist and Motley Fool.
Analyst’s 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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