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Investing.com - BofA Securities raised its price target on AGNC Investment Corp (NASDAQ:AGNC) to $9.25 from $8.50 while maintaining a Neutral rating on the stock. With a market capitalization of $10 billion and an impressive dividend yield of ~15%, AGNC currently trades at a P/E ratio of 37x. According to InvestingPro data, analyst targets range from $8.50 to $10.50.
AGNC reported second-quarter core earnings per share of $0.38, which fell short of both BofA Securities and consensus forecasts of $0.41. The variance was attributed to ATM issuance and lower spread income. InvestingPro analysis reveals that AGNC has maintained dividend payments for 18 consecutive years, suggesting strong dividend stability despite earnings fluctuations.
The company posted a negative 1% economic return for the quarter, as tariff-related macroeconomic uncertainty in April caused Agency MBS to underperform most asset classes.
Despite recent challenges, AGNC indicated that the investment outlook for Agency MBS remains attractive due to favorable supply and demand dynamics, wide mortgage spreads, and a cautious approach to GSE reform.
BofA Securities noted that AGNC reported the return on equity for new investments is between 18-20%, suggesting dividend stability in the current environment, though the firm believes the risk/reward balance remains neutral.
In other recent news, AGNC Investment Corp reported a comprehensive loss of $0.13 per share for the second quarter of 2025. This result was significantly below analyst expectations, which had projected earnings of $0.41 per share. The mortgage real estate investment trust also posted a net loss of $0.17 per share, contrasting with a $0.02 gain in the previous quarter. Additionally, AGNC’s net spread and dollar roll income, a crucial profitability measure for mortgage REITs, decreased to $0.38 per share from $0.44 in the first quarter. These developments come amid widening mortgage spreads and increased market volatility. The company’s earnings miss is a notable event for investors, reflecting current challenges in the market. AGNC Investment Corp’s recent performance highlights the impact of market conditions on its financial results.
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