Annaly Capital Management (NYSE:NLY – Get Rating) and AGNC Investment (NASDAQ:AGNCN – Get Rating) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their earnings, dividends, valuation, institutional ownership, profitability, risk and analyst recommendations.
Analyst Ratings
This is a summary of recent recommendations and price targets for Annaly Capital Management and AGNC Investment, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Annaly Capital Management | 0 | 2 | 4 | 0 | 2.67 |
| AGNC Investment | 0 | 0 | 0 | 0 | N/A |
Annaly Capital Management presently has a consensus target price of $21.69, suggesting a potential upside of 6.05%. Given Annaly Capital Management’s higher probable upside, research analysts plainly believe Annaly Capital Management is more favorable than AGNC Investment.
Profitability
| Net Margins | Return on Equity | Return on Assets | |
| Annaly Capital Management | -38.80% | 18.86% | 2.25% |
| AGNC Investment | N/A | N/A | N/A |
Earnings & Valuation
This table compares Annaly Capital Management and AGNC Investment’s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Annaly Capital Management | $2.78 billion | 3.63 | $1.73 billion | ($2.25) | -9.09 |
| AGNC Investment | -$615.00 million | N/A | N/A | N/A | N/A |
Annaly Capital Management has higher revenue and earnings than AGNC Investment.
Dividends
Annaly Capital Management pays an annual dividend of $2.60 per share and has a dividend yield of 12.7%. AGNC Investment pays an annual dividend of $1.75 per share and has a dividend yield of 6.8%. Annaly Capital Management pays out -115.6% of its earnings in the form of a dividend. AGNC Investment has increased its dividend for 2 consecutive years.
Insider and Institutional Ownership
51.2% of Annaly Capital Management shares are owned by institutional investors. 0.3% of Annaly Capital Management shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Summary
Annaly Capital Management beats AGNC Investment on 9 of the 11 factors compared between the two stocks.
About Annaly Capital Management
Annaly Capital Management, Inc., a diversified capital manager, engages in mortgage finance. The company invests in agency mortgage-backed securities collateralized by residential mortgages; non-agency residential whole loans and securitized products within the residential and commercial markets; mortgage servicing rights; agency commercial mortgage-backed securities; residential mortgage loans; and agency or private label credit risk transfer securities. It has elected to be taxed as a real estate investment trust (REIT). As a REIT, it is not subject to federal income tax to the extent that it distributes its taxable income to its shareholders. The company was incorporated in 1996 and is based in New York, New York.
About AGNC Investment
AGNC Investment Corp. operates as a real estate investment trust (REIT) in the United States. It invests in residential mortgage pass-through securities and collateralized mortgage obligations for which the principal and interest payments are guaranteed by the United States government-sponsored enterprise or by the United States government agency. The company funds its investments primarily through collateralized borrowings structured as repurchase agreements. It has elected to be taxed as a REIT under the Internal Revenue Code of 1986 and would not be subject to federal corporate income taxes, if it distributes at least 90% of its taxable income to its stockholders. The company was formerly known as American Capital Agency Corp. and changed its name to AGNC Investment Corp. in September 2016. AGNC Investment Corp. was incorporated in 2008 and is headquartered in Bethesda, Maryland.
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