| Factor | Score | Distribution | Value | Avg | Rank |
|---|---|---|---|---|---|
Valuation | 69 | 5.3x | 17.8x | Top tier | |
Growth | 62 | 12.5% | 7.1% | Around median | |
Quality | 70 | 6.5% | 4.5% | Top tier | |
Safety | 23 | 15.0x | 2.6x | Bottom tier | |
Capital Return | 70 | 13.01% | 2.12% | Top tier | |
Momentum | 54 | 8.1% | 2.9% | Around median | |
Sentiment | 46 | 7 | 3 | Around median |
Estimates — analyst targets and a simplified DCF, not investment advice.
Ten ratios that matter, each compared against its sector median and average — so you can see whether a number is rich or cheap relative to peers in the same sector.
Annaly Capital Management operates through a specialized housing finance platform and allocates capital across three interconnected strategies: Agency mortgage-backed securities, Residential Credit, and mortgage servicing rights, or MSR. Returns come from asset income and financing spreads, from creating proprietary investments by purchasing loans and securitizing them through the OBX platform, and from cash flows generated by servicing rights; as of June 30, 2026, the market value of the Agency portfolio was approximately $95 billion, compared with $10.4 billion for Residential Credit and $4.1 billion for the MSR portfolio, representing 57%, 22%, and 21% of capital, respectively.
In Q2 FY2026, Annaly recorded revenue of $2.2 billion, gross profit of $2.2 billion, and net income of $822.7 million, equivalent to earnings per share of $1.06 and a net margin of approximately 37.4%. These results improved compared with Q1 FY2026, when revenue was $1.6 billion, net income was $282.7 million, and earnings per share were $0.33; 2026 trailing twelve-month data also reached revenue of $7.3 billion, net income of $3.0 billion, and earnings per share of $4.13.
Based on management's non-GAAP measures, the company generated earnings available for distribution of $0.79 per share in Q2 FY2026, exceeding the quarterly dividend of $0.75 per share for the ninth consecutive quarter. Book value per share rose 1.7% to $20.15, and the economic return was 5.5% during the quarter and 6.9% during the first half of FY2026, while the net interest margin increased 5 basis points to 1.76% and the net interest spread improved 8 basis points to 1.5%.
The analyst consensus is "Buy," with an average price target of $23.5 and a narrow range between $23 and $24. The average target is 17.5% above the low end of the 52-week range of $20, but approximately 4.2% below the high end of $24.52, placing the expected valuation within the annual range rather than indicating a clear breakout above it. This consensus should be weighed against book value's sensitivity to interest rates and the narrow dividend coverage of $0.04 per share in Q2 FY2026.
Figures in the text are as of 2026-08-29; the live price is shown at the top of the page.
Annaly allocates its capital among Agency, Residential Credit, and MSR, with these strategies accounting for 57%, 22%, and 21%, respectively, as of June 30, 2026. Earnings come from returns on securities and loans after financing costs, from proprietary investments created by the OBX platform through loan purchases and securitizations, and from cash flows generated by mortgage servicing rights. In Q2 FY2026, revenue was $2.2 billion and net income was $822.7 million, while the net interest margin reached 1.76%.
Earnings available for distribution were $0.79 per share in Q2 FY2026, compared with a quarterly dividend of $0.75, representing coverage of $0.04. This was the ninth consecutive quarter in which earnings available for distribution exceeded the dividend. However, management said during the July 22, 2026 call that in some quarters earnings may equal the dividend or fall slightly below it, and that sustainability should be assessed over a longer time horizon.
OBX allows Annaly to transform loans aggregated through Onslow Bay into private securities, a portion of which the company retains as higher-yielding investments. In Q2 FY2026, the platform closed 13 deals with an original balance of $6.8 billion and created approximately $780 million of proprietary investments. During the first half of FY2026, the total reached 25 deals valued at $14.2 billion, approximately 70% of which involved Non-QM and DSCR, and the platform also completed two consecutive deals valued at $1 billion each.
Automated analysis for informational purposes only — not investment advice.
Interest rates affect the value of mortgage-backed securities, repurchase costs, hedging income, and prepayment speeds. In Q2 FY2026, lower volatility and a 6-basis-point decline in the average repurchase cost to 3.84% supported earnings, but lower swap receive rates reduced part of this benefit. To mitigate risk, Annaly maintained economic leverage at 5.6 times and added hedging swaps, while book value declined by slightly more than 1% through July 17, 2026, after quarter-end.
The market value of the MSR portfolio was approximately $4.1 billion as of June 30, 2026, representing 21% of the company's capital. The related loans carry an average interest rate of 3.3%, providing protection against prepayments, while serious delinquencies remained near 50 basis points and prepayment speed was 5.2 CPR in Q2 FY2026. Annaly uses subservicers at a fixed cost per loan, and therefore sold two low-balance pools for $220 million and committed to purchasing servicing rights with a higher average loan balance valued at approximately $200 million to improve returns.
Annaly ended Q2 FY2026 with $8 billion of unencumbered assets, including $5.5 billion of cash and unencumbered Agency securities. Total assets available for financing were $9.6 billion, an increase of approximately $580 million from the previous quarter, along with $1.6 billion of MSR interests pledged to committed undrawn facilities. In contrast, the portfolio relies on economic leverage of 5.6 times and repurchase financing with an average maturity of 33 days, making liquidity management and interest-rate hedging critical.
