Annaly Capital (NLY) Stock Forecast & Price Target

Annaly Capital Management is supported by a diversified mortgage REIT platform that has repeatedly shown resilience versus agency-heavy peers, with 3Q BVPS of $17.86 declining 11% q/q but still outperforming the drop seen across more monoline names. Its EAD rose to $0.80 per share and management said dividends remain covered by the portfolio and new-money returns, while the Agency/Resi Credit/MSR mix helps offset agency MBS negative convexity and rate volatility. The firm also strengthened capital and flexibility by raising $757 million through ATM equity, redeeming higher-cost preferred stock, and maintaining ample liquidity, while MSRs and resi credit benefit from higher rates and provide a hedge to the Agency book.

Annaly Capital Management is facing a softer earnings and book-value trajectory, as its 2027 EAD per share estimate was trimmed to $3.12 from $3.22 while book value per share fell to $17.86, down 11.4% quarter over quarter from $20.15. The firm’s reliance on a highly leveraged agency MBS portfolio leaves it exposed to rising funding costs, changing Fed purchases, and spread widening, all of which can compress net interest margins and reduce dividend capacity. Even with limited direct credit risk in the agency book, interest-rate volatility, prepayment pressure, and mortgage spread moves can still erode net asset value and earnings power.