NLY - Annaly Capital: Gauging Potential As Q2 Results Approach

2024-07-20 09:23:19 ET

Summary

• Annaly Capital's portfolio has had a tough couple of years, but cyclical opportunity may be ahead.
• Members of the Fed have given clearer signs that rate cuts are on the way, which benefit a portfolio like Annaly's.
• Yet the current price suggests fair valuation, not a price that mitigates potential risks that come with investing in NLY.

Annaly Capital ( NLY ) is a mortgage REIT I've covered before . My previous thesis in December was rather scathing, and I noted the preferred shares represented better income vehicles over the long term than the common. In it, I concluded:

Because of its history of declining dividends, its lack of clear signals that this will improve, and the safer returns offered by the preferred, it's my view that shares of NLY are a SELL for investors seeking dependable income.

For further details see: