AGM - Farmer Mac: Ultra Safe Dividend Growth With Double Digit Upside Potential
2024-04-18 12:45:07 ET
Summary
- Federal Agricultural Mortgage Corporation has seen a 17% return since initial coverage, surpassing the S&P 500's return.
- AGM recently raised its dividend by 27%. Over the last decade, the dividend has increased at a CAGR in the double digits.
- AGM operates in agricultural financing and rural infrastructure finance. Both of these segments saw YoY growth to fuel earnings.
- Based on my dividend discount model, fair value indicates a potential upside of over 25%.
Overview
Federal Agricultural Mortgage Corporation (AGM) had the honor of being the first company I covered here on Seeking Alpha, back in July of 2023. Since my initial coverage titled: ' Farmer Mac: Solid Fundamentals Supported By Well-Covered Dividend' , AGM has returned over 17%, which surpasses the total return of the S&P 500 ( SPY ) of only 11.5%. Since my initial coverage, we've seen large dividend raise, improved financials, and stellar price movement. However, I wanted to revisit this company and build a case for the additional upside potential that I expect....
Farmer Mac: Ultra Safe Dividend Growth With Double Digit Upside Potential