From Seekingalpha · Colorado Wealth Management Fund · · 1m 50s
Annaly Preferred Share Near Buy Target
Annaly Capital's preferred share nears buy target with 9.31% yield.
In brief
Annaly Capital's preferred share nears buy target with 9.31% yield. Annaly Capital's NLY.PR.F preferred share offers 9.31% yield and trades $0.11 above buy target of $25.27. Originally reported by Seekingalpha.
Preferred Share Overview
Annaly Capital Management's NLY.PR.F preferred share offers 9.31% stripped yield and carries our lowest risk rating in the mortgage REIT sector.
Current Price Target
NLY.PR.F trades just $0.11 above our buy target of $25.27, placing it in our hold range but extremely close to a buy.
Call Risk
The primary risk is negative yield to call, as Annaly could redeem NLY.PR.F at $25, resulting in a slight capital loss at current prices.
Company Safety
Annaly's substantial common equity relative to its preferreds enhances safety, but we remain disciplined on entry price, prioritizing value over chasing yield.
Floating Dividend
NLY.PR.F is a fixed-to-floating preferred share with a current floating yield on price of around 9.30%.
Spread Comparison
The 4.993% spread is materially more than Annaly Capital Management, Inc. PFD SER G (NLY.PR.G), which has a spread of only 4.172%.
Downside Risk
The annualized yield to call is approximately negative 2.3%, meaning investors could face a slight capital loss if Annaly redeems shares at $25.
Recent Redemption
Annaly recently redeemed NLY-I on October 1, 2026, with a floating spread of 4.989% similar to NLY.PR.F's 4.993%.
Risk Rating
NLY.PR.F carries a risk rating of 1 on our scale from 1 to 5, considered the least risky in the mortgage REIT sector.
Price Target Range
Our current price targets are: Strong Buy Under $24.29, Buy Under $25.27, Overpriced $25.87.
Final Position
At $25.38, NLY.PR.F is in our hold range with no preferred shares in the buy range under a risk rating of 2.5.
The main idea
Annaly Capital's NLY.PR.F preferred share offers 9.31% yield and trades $0.11 above buy target of $25.27.
