Dynex Capital (DX)
NYSE:DX
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Dynex Capital
(NYSE:DX)
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Rating:66Neutral
Price Target:
$13.00
▼(-1.59% Downside)
Action:ReiteratedDate:02/27/26
The score is driven primarily by improved profitability and a positive earnings-call outlook (strong returns, book value gains, and sizable liquidity), supported by constructive technical trends and very attractive headline valuation (low P/E, high yield). These positives are tempered by high leverage and inconsistent cash conversion, which materially increase sensitivity to mortgage spreads and financing conditions.
Positive Factors
Profitability and Returns
A material rebound in profitability and sizable reported net income demonstrate that the core net interest spread and portfolio positioning generated durable earnings upside in the current rate environment. Sustained higher earnings improve capacity to fund dividends, absorb mark-to-market volatility, and reinvest in portfolio growth, strengthening the company's ability to deliver shareholder returns over the next several months.
Negative Factors
High Leverage
A very high leverage profile materially amplifies sensitivity to funding costs and mortgage spread moves. Elevated debt levels limit financial flexibility, increase refinancing and counterparty risk, and make dividend sustainability contingent on favorable spread and funding environments—risk factors that remain relevant over a multi-month horizon.
Read all positive and negative factors
Positive Factors
Negative Factors
Profitability and Returns
A material rebound in profitability and sizable reported net income demonstrate that the core net interest spread and portfolio positioning generated durable earnings upside in the current rate environment. Sustained higher earnings improve capacity to fund dividends, absorb mark-to-market volatility, and reinvest in portfolio growth, strengthening the company's ability to deliver shareholder returns over the next several months.
Read all positive factors
Dynex Capital (DX) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.67B
Dividend Yield14.63%
Average Volume (3M)6.25M
Price to Earnings (P/E)2.9
Beta (1Y)0.50
Revenue Growth47.97%
EPS Growth17.22%
CountryUS
Employees22
SectorReal Estate
Sector Strength53
IndustryREIT - Mortgage
Share Statistics
EPS (TTM)0.22
Shares Outstanding201,983,260
10 Day Avg. Volume4,356,257
30 Day Avg. Volume6,245,743
Financial Highlights & Ratios
PEG Ratio0.08
Price to Book (P/B)0.71
Price to Sales (P/S)3.26
P/FCF Ratio14.39
Enterprise Value/Market Cap5.59
Enterprise Value/Revenue27.97
Enterprise Value/Gross Profit27.97
Enterprise Value/Ebitda20.21
Forecast
1Y Price Target
$15.25Price Target Upside15.44% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
EPS Forecast (FY)1.33
Revenue Forecast (FY)$380.41M
Dynex Capital Business Overview & Revenue Model
Company Description
Dynex Capital, Inc., a mortgage real estate investment trust, invests in mortgage-backed securities (MBS) on a leveraged basis in the United States. It invests in agency and non-agency MBS consisting of residential MBS, commercial MBS (CMBS), and ...
How the Company Makes Money
Dynex Capital primarily makes money from net interest income generated by its investment portfolio. It purchases agency MBS (and other mortgage-related assets), which pay interest and principal cash flows, and funds those holdings largely with sho...
Dynex Capital Earnings Call Summary
Earnings Call Date:Jan 26, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 20, 2026
Earnings Call Sentiment Positive
The call emphasized very strong financial and operating performance—double-digit quarterly and annual returns, meaningful book value and dividend gains, significant accretive capital raising, scale expansion, and improved expense efficiency. Management also highlighted structural tailwinds from a reactivated GSE presence and continued demand for income, positioning Dynex to deploy capital opportunistically. Offsetting items include spread tightening that reduces near-term upside versus the exceptional prior environment, persistent policy uncertainty affecting prepayment/convexity dynamics, and a short-term increase in compensation-driven expenses. On balance, the positive operational and financial developments, robust liquidity, and disciplined capital deployment materially outweigh the manageable risks discussed on the call.Positive Updates
Exceptional Total Economic Returns
Fourth-quarter total economic return (TER) of 10.2% and full-year 2025 TER of 21.7% (the highest TER this decade), reflecting strong portfolio performance and driving shareholder value.
Negative Updates
Spread Tightening Reduced Upside
Mortgage spreads tightened meaningfully versus prior quarters (management estimated roughly 100–300 basis points tighter depending on coupon), which lowers potential upside from the prior 'generational opportunity' environment and reduces some of the outsized return potential seen in earlier periods.
Read all updates
Q4-2025 Updates
Positive
Negative
Exceptional Total Economic Returns
Fourth-quarter total economic return (TER) of 10.2% and full-year 2025 TER of 21.7% (the highest TER this decade), reflecting strong portfolio performance and driving shareholder value.
Read all positive updates
Company Guidance
Management's forward guidance emphasized disciplined, accretive growth and a supportive spread regime: they expect hedged ROEs in the mid‑teens at roughly 7x leverage and mid‑to‑high‑teens at targeted low‑8x leverage, will continue ATM issuance and deployment after raising and investing over $1.0B in 2025 (≈$1.5B over the last 13 months, nearly $350M in early January), and have grown TBAs/MBS from $9.8B at the start of 2025 to $19.4B at year‑end and about $22B currently. Key metrics called out include Q4 TER 10.2% and 2025 TER 21.7%, Q4 common dividend $0.51 and $2.00 declared for 2025 (monthly), book value +$0.78 in Q4 and +$0.75 for the year (current BV $13.85–$14.05, +3–4% since year‑end), comprehensive income $190M/Q4 and $354M/YTD, quarter‑end leverage 7.3x, $1.4B unencumbered liquidity (>55% of equity), taxable earnings est. $229M covering all preferred and ~93% of common dividends, and G&A at ~2.1% of equity; they noted spreads have tightened ~150–300 bps since the prior quarter, expect the GSE retained‑portfolio announcement (+$200B) and >$100B of bank demand to bias spreads tighter, and will retain a swap‑biased hedge (potentially 60–80% of the hedge book) plus options to manage convexity while issuing only when accretive.Dynex Capital Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
48
Neutral
Cash Flow
40
Negative
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 533.52M | 318.03M | 132.60M | -2.37M | 66.76M |
| Gross Profit | 533.52M | 318.03M | 132.60M | -2.37M | 66.76M |
| EBITDA | 738.23M | 427.56M | 209.32M | 186.77M | 107.93M |
| Net Income | 319.07M | 113.90M | -6.13M | 143.16M | 102.26M |
Balance Sheet | |||||
| Total Assets | 17.34B | 8.18B | 6.37B | 3.61B | 3.64B |
| Cash, Cash Equivalents and Short-Term Investments | 930.39M | 377.23M | 119.64M | 332.04M | 366.02M |
| Total Debt | 13.91B | 6.59B | 0.00 | 0.00 | 0.00 |
| Total Liabilities | 14.88B | 7.00B | 5.50B | 2.70B | 2.87B |
| Stockholders Equity | 2.46B | 1.18B | 870.74M | 901.33M | 771.28M |
Cash Flow | |||||
| Free Cash Flow | 120.82M | 14.39M | 62.20M | 126.35M | 146.97M |
| Operating Cash Flow | 120.82M | 14.39M | 62.20M | 126.35M | 146.97M |
| Investing Cash Flow | -8.07B | -1.03B | -2.96B | -65.44M | -555.38M |
| Financing Cash Flow | 8.26B | 1.40B | 2.69B | -32.34M | 519.98M |
Dynex Capital Technical Analysis
Positive
13.21
Price Trends
13.28
Negative
13.29
Negative
12.46
Positive
Market Momentum
-0.09
Negative
55.98
Neutral
84.34
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DX, the sentiment is Positive. The current price of 13.21 is above the 20-day moving average (MA) of 12.73, below the 50-day MA of 13.28, and above the 200-day MA of 12.46, indicating a neutral trend. The MACD of -0.09 indicates Negative momentum. The RSI at 55.98 is Neutral, neither overbought nor oversold. The STOCH value of 84.34 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DX.
Dynex Capital Risk Analysis
Dynex Capital disclosed 36 risk factors in its most recent earnings report. Dynex Capital reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Dynex Capital Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
66 Neutral | $2.67B | 2.95 | 17.19% | 14.63% | 47.97% | 17.22% | |
65 Neutral | $2.17B | 12.19 | 3.79% | 4.94% | 3.15% | 1.96% | |
60 Neutral | $1.51B | 10.61 | 6.83% | 9.89% | 0.29% | ― | |
58 Neutral | $2.10B | 2.34 | 16.65% | 15.06% | -27.55% | -97.87% | |
55 Neutral | $1.01B | 8.54 | 6.79% | 12.69% | -15.48% | -36.45% | |
53 Neutral | $1.11B | 4.43 | 8.85% | 11.40% | 9.46% | -111.44% | |
51 Neutral | $1.15B | -2.41 | -23.93% | 14.29% | 22.48% | 50.49% |
* Real Estate Sector Average
DX
Dynex Capital
13.21
3.72
39.21%
ARI
Apollo Real Estate
10.83
3.40
45.82%
ARR
ARMOUR Residential REIT
17.56
5.69
47.99%
CIM
Chimera Investment
13.28
3.64
37.76%
TWO
Two Harbors
10.97
1.59
16.95%
PMT
PennyMac Mortgage
11.60
0.86
8.02%
Dynex Capital Corporate Events
Business Operations and StrategyExecutive/Board Changes
Dynex Capital Announces CFO Transition and Leadership Changes
Positive
Feb 27, 2026
On February 26, 2026, Dynex Capital’s board appointed longtime executive Michael Sartori as chief financial officer, elevating him from his role as head of capital markets and FPA, where he helped drive capital strategy, growth, and risk ana...
Business Operations and StrategyPrivate Placements and FinancingRegulatory Filings and Compliance
Dynex Capital Expands At-The-Market Equity Offering Capacity
Neutral
Jan 27, 2026
On January 27, 2026, Dynex Capital, Inc. amended its existing at-the-market equity distribution agreement with a syndicate of sales agents, increasing the total number of authorized common shares for potential sale by 60,000,000 to 221,292,973, of...
Business Operations and StrategyExecutive/Board ChangesDividendsFinancial DisclosuresPrivate Placements and Financing
Dynex Capital reports strong 2025 results, enhances leadership
Positive
Jan 26, 2026
On January 26, 2026, Dynex Capital reported strong fourth-quarter and full-year 2025 results, highlighted by total economic return of $1.29 per common share, or 10.2% of beginning book value, for the quarter and $2.75, or 21.6%, for the year, alon...
Executive/Board Changes
Dynex Capital announces director Joy Palmer’s planned departure
Neutral
Jan 16, 2026
On January 13, 2026, Dynex Capital, Inc. announced that director Joy Palmer has informed the company she will not stand for re-election to the Board of Directors at the 2026 Annual Meeting of Shareholders, although she will continue to serve on th...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.