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Annaly (NLY) Stock Up 3.6% on Q2 Earnings Beat, NII Rises
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Shares of Annaly Capital Management, Inc. (NLY - Free Report) rallied 3.6% following the release of its better-than-expected second-quarter earnings. NLY reported second-quarter 2022 earnings available for distribution (EAD) per share of 30 cents, which surpassed the Zacks Consensus Estimate of 25 cents. The figure remained flat compared with the year-ago quarter.
NLY registered a year-over-year decline in book value per share (BVPS), while the average yield on interest-earning assets and margin improved.
The net interest income (NII) was $475.1 million, surpassing the Zacks Consensus Estimate of $322 million. The figure jumped 47.2% year over year.
Inside the Headlines
At the second-quarter end, Annaly had $82.3 billion of total assets, with $74.9 billion invested in the Agency portfolio. At the end of the quarter, unencumbered assets stood at $6.3 billion.
In the reported quarter, the average yield on interest-earning assets (excluding premium amortization adjustment or PAA) was 2.87%, up from the prior-year quarter’s 2.76%. Average economic costs of interest-bearing liabilities were 1.11%, increasing from 0.83%.
Net interest spread (excluding PAA) of 1.76% for the second quarter fell from 1.93% in the prior-year quarter. Nonetheless, the net interest margin (excluding PAA) in the reported quarter was 2.20% compared with 2.09% in second-quarter 2021.
Annaly’s BVPS was $5.90 as of Jun 30, 2022, sequentially down from $6.77. Moreover, BVPS compared unfavorably with $8.37 as of Jun 30, 2021. At the end of the reported quarter, Annaly’s economic capital ratio was 13%, declining from 14.3% in the prior-year quarter.
For the second quarter, the weighted average actual constant prepayment rate was 14.9%, sequentially down from 16.7%.
Economic leverage was 6.6X as of Jun 30, 2022, up from 6.4X (sequentially) and 5.8X in the prior-year quarter. Annaly generated an annualized EAD return on average equity (excluding PAA) of 17.49% in the second quarter, up from the prior-year quarter’s 13.05%.
Annaly Capital Management Inc Price, Consensus and EPS Surprise
AGNC Investment Corp. (AGNC - Free Report) reported a second-quarter 2022 net spread and dollar roll income per common share (excluding estimated "catch-up" premium amortization costs) of 83 cents per share, beating the Zacks Consensus Estimate of 60 cents. The reported figure improved from 76 cents posted in second-quarter 2021.
Adjusted net interest and dollar roll income (excluding catch-up premium amortization) was $546 million, declining from the quarter-ago number of $375 million.
We now look forward to the earnings releases of Starwood Property Trust (STWD - Free Report) . STWD is scheduled to report results on Aug 4.
Starwood Property carries a Zacks Rank #3 (Hold) at present.
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Annaly (NLY) Stock Up 3.6% on Q2 Earnings Beat, NII Rises
Shares of Annaly Capital Management, Inc. (NLY - Free Report) rallied 3.6% following the release of its better-than-expected second-quarter earnings. NLY reported second-quarter 2022 earnings available for distribution (EAD) per share of 30 cents, which surpassed the Zacks Consensus Estimate of 25 cents. The figure remained flat compared with the year-ago quarter.
NLY registered a year-over-year decline in book value per share (BVPS), while the average yield on interest-earning assets and margin improved.
The net interest income (NII) was $475.1 million, surpassing the Zacks Consensus Estimate of $322 million. The figure jumped 47.2% year over year.
Inside the Headlines
At the second-quarter end, Annaly had $82.3 billion of total assets, with $74.9 billion invested in the Agency portfolio. At the end of the quarter, unencumbered assets stood at $6.3 billion.
In the reported quarter, the average yield on interest-earning assets (excluding premium amortization adjustment or PAA) was 2.87%, up from the prior-year quarter’s 2.76%. Average economic costs of interest-bearing liabilities were 1.11%, increasing from 0.83%.
Net interest spread (excluding PAA) of 1.76% for the second quarter fell from 1.93% in the prior-year quarter. Nonetheless, the net interest margin (excluding PAA) in the reported quarter was 2.20% compared with 2.09% in second-quarter 2021.
Annaly’s BVPS was $5.90 as of Jun 30, 2022, sequentially down from $6.77. Moreover, BVPS compared unfavorably with $8.37 as of Jun 30, 2021. At the end of the reported quarter, Annaly’s economic capital ratio was 13%, declining from 14.3% in the prior-year quarter.
For the second quarter, the weighted average actual constant prepayment rate was 14.9%, sequentially down from 16.7%.
Economic leverage was 6.6X as of Jun 30, 2022, up from 6.4X (sequentially) and 5.8X in the prior-year quarter. Annaly generated an annualized EAD return on average equity (excluding PAA) of 17.49% in the second quarter, up from the prior-year quarter’s 13.05%.
Annaly Capital Management Inc Price, Consensus and EPS Surprise
Annaly Capital Management Inc price-consensus-eps-surprise-chart | Annaly Capital Management Inc Quote
Annaly currently carries a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Competitive Landscape
AGNC Investment Corp. (AGNC - Free Report) reported a second-quarter 2022 net spread and dollar roll income per common share (excluding estimated "catch-up" premium amortization costs) of 83 cents per share, beating the Zacks Consensus Estimate of 60 cents. The reported figure improved from 76 cents posted in second-quarter 2021.
Adjusted net interest and dollar roll income (excluding catch-up premium amortization) was $546 million, declining from the quarter-ago number of $375 million.
We now look forward to the earnings releases of Starwood Property Trust (STWD - Free Report) . STWD is scheduled to report results on Aug 4.
Starwood Property carries a Zacks Rank #3 (Hold) at present.