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AGNC Investment Corp. (NASDAQ:AGNC) is expected to post a fall in its Q3 earnings as compared to last quarter, when it reports its third-quarter results on Monday, Oct. 30.
Earlier this week had estimated its net spread and dollar roll income for Q3 to come in at $0.65 per share, a pull back from $0.67 in the previous quarter.
As of Sept. 30, 2023, the mortgage REIT's Q3 tangible net book value was estimated to be $8.08 a share, down from $9.39 on June 30, 2023.
AGNC's woes are incredible considering that the company issued equity at an extremely rapid clip, far above today's market price, said SA contributor Trapping Value.
Trapping Value also said AGNC will face steeply rising costs by early 2024 as hedges get lower.
"We think other REITs in this space have a better risk-reward ratio even for preferred shares. We think other REITs in this space have a better risk-reward ratio even for preferred shares," Trapping value added.
SA contributor Wealth Analytics believes that one of the key issues circling AGNC the last few months or even years is the higher leverage ratio the company has been having, adding the firm has made some improvements recently in its leverage ratio and debt/capital ratio
The mortgage REIT had beaten its estimates in Q2 after economic return on tangible common equity pushed it into positive territory.
REITs fell in the week ended Oct. 20 as the earnings season started on a mixed note for the sector and as macroeconomic factors impacted the broader markets.
VanEck Vectors Mortgage REIT Income ETF (MORT) has lost ~19.9% of its value year-to-date.
The consensus EPS Estimate is $0.61 (-27.4% Y/Y) and the consensus Revenue Estimate is $436.25M.
Over the last 2 years, AGNC has beaten EPS estimates 100% of the time and has beaten revenue estimates 38% of the time.
Over the last 3 months, EPS estimates have seen 4 upward revisions and 1 downward. Revenue estimates have seen 2 upward revisions and 2 downward.