High-Yield Dividend Stocks Show Potential amid Market Concerns

Investors eye mortgage REITs for high yields and dividends, but caution is advised. AGNC Investment and Annaly Capital currently offer substantial returns, yet face risks related to interest rates and market conditions.

Date: 09-03-2025

AI Rating: 6

Earnings Per Share (EPS)
Annaly Capital's net income on a GAAP basis reached $0.78 per share in the fourth quarter, supporting its dividend of $0.72 per quarter. This suggests a reliable income stream if rates remain stable.
Dividend Yields
AGNC Investment offers a yield of 14.2%, while Annaly Capital provides a 12.2% yield. This high yield reflects investor concern about declining net interest spreads.
Risks
Both companies are considered mREITs that depend heavily on interest rates. With financing costs surging and trade war fears elevating inflation risks, stock prices could be negatively affected. Potential interest rate hikes by the Federal Reserve could further complicate matters.
Investors should be mindful that while these companies offer attractive yields, their ability to maintain them is tied closely to a volatile interest rate environment, which may deter those seeking steady income. Overall, despite a robust historical total return for AGNC since its IPO, the risk factors present may dissuade income-seeking investors.

Stocks: AGNC NLY