Markets

Annaly Capital's (NLY) Q4 Earnings In line, Decrease Y/Y

Annaly Capital Management, Inc.NLY - the mortgage real estate investment trust (mREIT) - reported fourth-quarter 2016 adjusted core earnings of 30 cents per share, in line with the Zacks Consensus Estimate. However, it came lower than 31 cents earned in the year-ago quarter.

Net interest income (NII) in the quarter totaled $623.6 million, up 36.2% year over year.

For full-year 2016, the bottom-line came in at $1.17 per share, down from $1.28 recorded in the prior-year.

For 2016, NII came in at $1.55 billion, down from $1.70 billion recorded a year ago.

FindTheCompany | Graphiq

Quarter in Detail

For the reported quarter, average yield on interest-earning assets was 3.81%, while average cost of interest-bearing liabilities (including interest expense on interest rate swaps) was 1.53%.

This led to a net interest rate spread of 2.28% for the quarter, reflecting a year-over-year increase of 81 basis points. Net interest margin came in at 2.49% compared with 1.80% in the year-ago period.

The company's investment at fair value (including Agency mortgage-backed securities and Agency debentures) was $75.6 billion as of Dec 31, 2016, up from $65.9 billion as of Dec 31, 2015.

Annaly's book value per share came in at $11.16 as of Dec 31, 2016, compared with $11.73 as of Dec 31, 2015. At the end of the fourth quarter, the company's capital ratio (representing the ratio of stockholders' equity to total assets) was 13.1%, down from 13.7% at the end of the prior-year quarter.

Leverage was 5.8:1 as of Dec 31, 2016, compared with 6.0:1 as of Dec 31, 2015. The company offered an annualized core return on average equity of 10.13% in the quarter, down from 10.30% in the year-ago quarter.

Our Take

Going forward, we believe Annaly's diversification into commercial assets would help enhance its top-line growth.

Another mREIT - AGNC Investment Corp. AGNC - reported fourth-quarter 2016 net spread and dollar roll income of 64 cents per share (excluding estimated "catch-up" premium amortization benefit) that comfortably beat the Zacks Consensus Estimate of 60 cents. The reported figure was same as the prior quarter.

While Annaly sports a Zacks Rank #1 (Strong Buy), AGNC Investment carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank stocks here .

Annaly Capital Management Inc Price, Consensus and EPS Surprise

Annaly Capital Management Inc Price, Consensus and EPS Surprise | Annaly Capital Management Inc Quote

Two other REITs which are slated to report results next week are Welltower Inc. HCN and Host Hotels & Resorts, Inc. HST .

Just Released - Driverless Cars: Your Roadmap to Mega-Profits Today

In this latest Special Report, Zacks' Aggressive Growth Strategist Brian Bolan explores a full-blown technological breakthrough in the making - autonomous cars. He also spotlights 8 stocks with tremendous gain potential to feed off this phenomenon. Click to see the stocks right now >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

American Capital Agency Corp. (AGNC): Free Stock Analysis Report

Annaly Capital Management Inc (NLY): Free Stock Analysis Report

Host Hotels & Resorts, Inc. (HST): Free Stock Analysis Report

Welltower Inc. (HCN): Free Stock Analysis Report

To read this article on Zacks.com click here.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

AGNC NLY HST

Other Topics

Earnings Stocks

Latest Markets Videos

    Zacks

    Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at www.zacks.com.

    Learn More