Is American Capital Agency Corp. (AGNC) Still Better Than Annaly Capital Management, Inc. (NLY)?

Book Value

The company’s book value decreased by 2.6% during the quarter to $31.64. In comparison, Annaly’s book value per share decreased by 4.5% in the fourth quarter to $15.85. During the quarter American Capital Agency repurchased 2.7 million shares of common stock for $77 million (at an average price of $29 per share) from the $500 million share authorization program. Annaly Capital is trading at a 4% discount to its book value and yielding 16% on its current dividend.

This is compared to 27.8 million shares of common stock repurchased by Annaly Capital for $397 million (at an average price of $14.28 per share). Annaly is currently trading at a 5% discount to first quarter book value and is yielding 12.1% on the current dividend.


Among the Agency-only mortgage REITs, and particularly in comparison to Annaly Capital, I continue to have the most confidence in American Capital Agency’s ability to deliver economic return through its active portfolio management. The company continues to expand its asset yield and the net interest spread despite the challenging macroeconomic environment under QE3.

The article Is American Capital Agency Still Better Than Annaly Capital? originally appeared on and is written by Adnan Khan.

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