Agnc Investment Corp High Dividend Yield for Income Investors

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If you're an income investor looking for a high dividend yield, Agnc Investment Corp is definitely worth considering. With a current dividend yield of 12.5%, it's one of the highest in the industry.

Agnc Investment Corp's high dividend yield is due in part to its focus on mortgage-backed securities. This type of investment has historically provided a stable source of income.

As a result, Agnc Investment Corp has been able to consistently pay out high dividends to its shareholders. In fact, the company has increased its dividend payout every year since its inception.

One of the key benefits of investing in Agnc Investment Corp is its ability to provide a regular income stream. With a dividend yield of 12.5%, investors can earn a significant return on their investment.

Yield

AGNC Investment Corp. is known for its attractive dividend yield, which is a key factor for income-seeking investors. This metric is represented visually in the AGNC dividend yield graph, showing the company's historical dividend yield over the last 12 months.

Credit: youtube.com, Monthly Dividend Stocks ( REITs ): Time to Buy AGNC Investment Corp (AGNC Stock)?

The graph helps identify trends and patterns in AGNC's dividend payments, making it easier to evaluate the company's financial health. AGNC's dividend yield is a crucial consideration for investors looking for regular income.

Shareholder yield is another important metric that measures the total return to shareholders through dividends, buybacks, and debt paydown. This ratio compares the cash returned to shareholders to the company's market capitalization.

AGNC's shareholder yield graph includes indicators for dividends, buybacks, and debt paydown, providing a comprehensive view of the company's financial position. Investors should consider shareholder yield in conjunction with other financial metrics, such as earnings and revenue.

Pros and Cons

AGNC Investment Corp offers a high dividend yield, but it's essential to consider the potential pros and cons.

The biggest advantage of AGNC Investment Corp is the frequent payments it provides, with a yield more than twice as high as the 10-year Treasury note.

However, a high dividend is not necessarily a sustainable dividend, and AGNC Investment Corp's payout ratio may be near 100%, which could lead to borrowing money or cutting the dividend.

If you prefer more reliable payments, other income investing strategies may work better for you, such as bond ladders, CD ladders, or Dividend Aristocrat stocks.

Many investors are drawn to the substantial payments provided by monthly dividend stocks like AGNC Investment Corp.

Research and Analysis

Credit: youtube.com, AGNC's 15% Monthly Dividend Outlook is Improving. Is It A Buy?

AGNC Investment Corp has a high dividend yield, with an annualized payout of $1.44 per share, which equals an extremely high current yield of 13.8% based on the current share price.

This high yield can be a sign of elevated risk, as AGNC has reduced its dividend several times over the past decade. However, management has taken steps to protect its interest income, and the expected interest rate reductions by the Fed over the next three years will provide a tailwind to AGNC.

The payout ratio is expected to remain below 75% of earnings for the foreseeable future, which suggests that a dividend cut is unlikely in the near term.

Analysis

AGNC Investment Corp. has a high annualized payout of $1.44 per share, which is an extremely high current yield of 13.8% based on the current share price.

This high yield is a sign of elevated risk, as AGNC's dividend has been reduced several times over the past decade. AGNC's net asset value appears to have stabilized, but management has taken steps to protect its interest income.

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The expected interest rate reductions by the Fed over the next three years will provide a tailwind to AGNC, which may help to stabilize the dividend payout. However, there is always a risk to the payout, particularly given the volatile behavior of interest rates in recent years.

AGNC's dividend yield has been volatile and has been on a downward trend during the past decade. The share price has also been falling, which can make the yield seem higher than it actually is.

The dividend payment has been shrinking over time, which means that investors who bought the stock thinking they had locked in a big income stream actually ended up with a shrinking income stream. This is a crucial consideration for dividend investors.

AGNC's return, which assumes dividend reinvestment, is fairly close to the total return of the S&P 500 over time. This is because the dividend is so large that it more than compensates for the drop in the share price.

AGNC Investment Corp.'s dividend yield is 15.25%, which means that for every $100 invested in the company's stock, investors would receive $15.25 in dividends per year. This is a relatively high yield compared to other investments.

AGNC's payout ratio is 101.04%, which means that 101.04% of the company's earnings are paid out as dividends. This is a high payout ratio, which may indicate that the company is returning most of its earnings to shareholders.

Growth Prospects

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Mortgage REITs like AGNC face a major drawback in rising interest-rate environments. Their business model is negatively impacted by increasing rates, which can reduce the value of their investments and contract their interest margins.

AGNC's leverage ratio is quite high, at 7.4x, which means they have a lot of debt to amplify returns. This can be a double-edged sword, as it increases their potential earnings but also leaves them vulnerable to interest rate changes.

The recent surge in interest rates to 23-year highs has already taken a toll on AGNC's book value. As interest rates continue to rise, their earnings-per-share growth is likely to suffer.

However, there's a silver lining - inflation has finally moderated in most developed countries, including the US. This has led the Fed to begin reducing interest rates, which could provide a strong tailwind for AGNC's business.

History

AGNC Investment Corp. has a dividend history that's worth looking into.

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The company's dividend payments per share have averaged 0.00% over the past 12 months.

Over the past 36 months, the average dividend payment per share has also been 0.00%.

However, looking further back, AGNC's dividend payments per share have actually decreased by -6.91% over the past 60 months.

This trend continues, with a decrease of -5.74% over the past 120 months.

Investment Strategies

As you consider investing in AGNC Investment Corp, it's essential to think about your overall investment strategy. With a high dividend yield above 13.8%, AGNC is near the top of our list of high-yield dividend stocks.

Monthly dividends can give you the ability to compound dividends faster, which is a significant advantage. This is because you're earning interest on your interest every month.

Double-digit dividend yields often signal that investors don't believe the dividend is sustainable, and are pricing the stock in anticipation of a cut to the dividend. This is a crucial factor to consider.

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To mitigate this risk, it's essential to assess the sustainability of AGNC's high dividend yield. You can do this by evaluating the company's business model and financial health.

There are 76 monthly dividend stocks in our database, and you can download our full Excel spreadsheet of all monthly dividend stocks, including metrics like dividend yields and payout ratios.

Frequently Asked Questions

Is AGNC dividend safe for long term?

AGNC has a proven history of delivering substantial and consistent dividend income to its stockholders over the long term, with over $13 billion paid since inception. This track record suggests a relatively safe and reliable dividend for long-term investors.

How much does AGNC pay in monthly dividends?

AGNC Investment Corp. pays a monthly dividend of $0.12 per share. This dividend payment offers a high yield of 15.43% as of December 28.

What is the future of AGNC stock?

According to analyst forecasts, AGNC stock is predicted to increase by 11.79% to reach an average target of $10.43. This forecast is based on a current stock price of $9.33 and a range of estimates from $9.00 to $12.

Kristin Ward

Writer

Kristin Ward is a versatile writer with a keen eye for detail and a passion for storytelling. With a background in research and analysis, she brings a unique perspective to her writing, making complex topics accessible to a wide range of readers. Kristin's writing portfolio showcases her ability to tackle a variety of subjects, from personal finance to lifestyle and beyond.

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