Annaly Capital Management, Inc. (NYSE:NLY) ranks among the most undervalued REIT stocks to buy right now. On January 6, BTIG raised Annaly Capital Management, Inc. (NYSE:NLY) from Neutral to Buy, setting a $25 price target on the company’s shares. The firm indicated possible dividend support in today’s low-interest-rate, volatile environment, especially if expectations for additional Fed rate cuts this year remain high.
The firm expects Annaly Capital Management, Inc. to exhibit additional upside if mortgage-backed securities spreads compared to Treasuries, which are now approaching multi-year lows of roughly 115 basis points, narrow. In addition, the firm pointed to a more stable stock valuation if spreads expand again amid rising interest rate volatility.
Moreover, BTIG noted a drop in long-term interest rates, which could increase prepayment vulnerability in NLY’s MSR and non-QM portfolios, though the firm’s assessment also included some expectation that the Trump presidency will attempt to engineer lower mortgage rates.
Annaly Capital Management, Inc. is a diversified capital manager that engages in the mortgage finance business. The firm’s portfolio includes securities, loans, and equity in the mortgage finance market.
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This article is originally published at Insider Monkey.
