BTIG analyst Eric Hagen has maintained their bullish stance on DX stock, giving a Buy rating yesterday.
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Eric Hagen has given his Buy rating due to a combination of factors that highlight Dynex Capital’s strategic positioning and financial performance. The company’s current net asset value (NAV) is estimated at $12 per share, and it offers a high dividend yield of over 16%, which appears sustainable given the recent capital raise of $280 million. This capital is being deployed at historically wide mortgage-backed securities (MBS) spreads, providing a favorable environment for returns.
Moreover, Dynex Capital’s leverage has increased to 8.3x, supported by a low-interest rate volatility environment, which is beneficial for the company’s strategy of managing leverage with transparent parameters. The company’s ability to raise significant equity and maintain liquidity enhances its scale and flexibility. Additionally, the preferred stock’s floating-rate leg, which commenced in February, adds another layer of interest and potential benefit if the Federal Reserve delays rate cuts. These factors collectively contribute to the Buy rating, reflecting confidence in Dynex Capital’s capacity to navigate the current market conditions effectively.
According to TipRanks, Hagen is a 3-star analyst with an average return of 3.0% and a 53.81% success rate. Hagen covers the Real Estate sector, focusing on stocks such as Dynex Capital, Rithm Capital, and ARMOUR Residential REIT.
In another report released yesterday, JonesTrading also maintained a Buy rating on the stock with a $13.00 price target.