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Dynex Capital
(NYSE:DX)
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Rating:64Neutral
Price Target:
$13.50
▲(7.14% Upside)
Action:Reiterated
Date:07/28/26
The score is supported by attractive valuation (low P/E and high dividend yield) and a constructive earnings update (positive economic return, book value growth, strong liquidity, and accretive capital raised). Offsetting this, financial risk remains elevated due to high and rising leverage and cash flow that lags reported earnings, while near-term technicals show mild weakness with the stock below its 20- and 50-day averages.
Positive Factors
Strong income momentum
Sustained revenue and rising net interest income show the core mREIT engine is performing: income from agency MBS and improving NII provide a durable base to support distributions and reinvestment. This reduces reliance on one-off gains and supports predictable cash earnings over months.
Negative Factors
High and rising leverage
Very elevated leverage amplifies sensitivity to funding-cost increases and adverse mark-to-market moves. As an mREIT that funds with short-term repo and secured borrowings, higher debt limits flexibility, raises rollover risk, and can quickly pressure book value and distributable cash in stressed markets.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong income momentum
Sustained revenue and rising net interest income show the core mREIT engine is performing: income from agency MBS and improving NII provide a durable base to support distributions and reinvestment. This reduces reliance on one-off gains and supports predictable cash earnings over months.
Read all positive factors
Dynex Capital (DX) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.15B
Dividend Yield16.05%
Average Volume (3M)5.67M
Price to Earnings (P/E)4.8
Beta (1Y)0.49
Revenue Growth136.45%
EPS Growth234.34%
CountryUS
Employees28
SectorReal Estate
Sector Strength53
IndustryREIT - Mortgage
Share Statistics
EPS (TTM)2.65
Shares Outstanding248,166,920
10 Day Avg. Volume7,393,950
30 Day Avg. Volume5,674,178
Financial Highlights & Ratios
PEG Ratio0.09
Price to Book (P/B)0.71
Price to Sales (P/S)3.26
P/FCF Ratio14.39
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$14.75Price Target Upside17.06% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering3
EPS Forecast (FY)1.48
Revenue Forecast (FY)$414.01M
Dynex Capital Business Overview & Revenue Model
Company Description
Dynex Capital, Inc. (DX) is a U.S. mortgage real estate investment trust (mREIT) that invests primarily in agency mortgage-backed securities (MBS), including residential MBS, and finances these investments largely through repurchase agreements and...
How the Company Makes Money
Dynex Capital primarily makes money by earning net interest income on a leveraged investment portfolio of agency mortgage-backed securities. It purchases MBS that pay interest and principal cash flows, and it funds a substantial portion of those h...
Dynex Capital Earnings Call Summary
Earnings Call Date:Jul 20, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 26, 2026
Earnings Call Sentiment Positive
The call presented multiple clear, tangible positives: a strong 6.4% total economic return, accretive $391 million capital raise, meaningful book value growth, a sizable expansion of the agency MBS portfolio (>40%), and a strong liquidity position (>$1.6B, >51% of equity). These operational and financial achievements outweigh the identified risks, which primarily relate to macro/geopolitical uncertainty, potential AI-driven prepayment/negative convexity, a modest quarter-to-date book value softening, and a deliberately conservative leverage posture. Management emphasized disciplined, liquidity-focused execution and a constructive outlook for agency MBS, suggesting confidence in navigating the risks while continuing to grow scale and dividend income.Positive Updates
Strong Total Economic Return and Dividend
Total economic return for the quarter was 6.4%. Results included $0.51 per share in common dividends and $0.30 per share from portfolio value increase, reflecting both cash yield and mark-to-market gains.
Negative Updates
Quarter-to-Date Book Value Softening
Quarter-to-date through July 17, spreads were ~3 basis points wider and reported book value was approximately $12.67 (versus $12.90 at quarter end), reflecting a modest short-term decline in mark-to-market value (~1.8% decline from quarter-end).
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Total Economic Return and Dividend
Total economic return for the quarter was 6.4%. Results included $0.51 per share in common dividends and $0.30 per share from portfolio value increase, reflecting both cash yield and mark-to-market gains.
Read all positive updates
Company Guidance
The company guided that it will continue to build scale in agency MBS while preserving liquidity and balance‑sheet flexibility, highlighting a strong Q2 with total economic return of 6.4%, book value of $12.90 (+2.4% vs. $12.60 Q1), $0.51 per‑share common dividend and $0.30 per‑share portfolio mark‑to‑market gain, net interest income of $0.42 per share (up from $0.40), accretive capital raised of $391 million, capital base up to $3.1 billion from $2.4 billion at year‑end and agency MBS portfolio growth >40% (5x capital base growth since 2022); Q2 adjusted leverage was 8.1 (vs. 8.6 prior) with a target operating range of ~7.5–8.5 and tactical ±1x flexibility, liquidity of $1.6 billion (>$51% of equity), an announced operating expense target of ~2% of total equity for the year, a lowered 2026 net supply forecast to $165 billion (from $200 billion), and an expectation that agency spreads can equilibrate around ~100–120 bps.Dynex Capital Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
38
Negative
Cash Flow
45
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 886.86M | 533.52M | 318.03M | 132.60M | -2.37M | 66.76M |
| Gross Profit | 677.89M | 533.52M | 318.03M | 132.60M | -2.37M | 66.76M |
| EBITDA | 771.29M | 740.33M | 429.42M | 211.63M | 189.13M | 110.24M |
| Net Income | 436.18M | 319.07M | 113.90M | -6.13M | 143.16M | 102.26M |
Balance Sheet | ||||||
| Total Assets | 26.42B | 17.34B | 8.18B | 6.37B | 3.61B | 3.64B |
| Cash, Cash Equivalents and Short-Term Investments | 607.56M | 930.39M | 377.23M | 119.64M | 332.04M | 366.02M |
| Total Debt | 22.64B | 13.91B | 6.59B | 0.00 | 0.00 | 0.00 |
| Total Liabilities | 23.24B | 14.88B | 7.00B | 5.50B | 2.70B | 2.87B |
| Stockholders Equity | 3.18B | 2.46B | 1.18B | 870.74M | 901.33M | 771.28M |
Cash Flow | ||||||
| Free Cash Flow | 236.58M | 120.82M | 14.39M | 62.20M | 126.35M | 146.97M |
| Operating Cash Flow | 236.58M | 120.82M | 14.39M | 62.20M | 126.35M | 146.97M |
| Investing Cash Flow | -14.92B | -8.07B | -1.03B | -2.96B | -65.44M | -555.38M |
| Financing Cash Flow | 15.16B | 8.26B | 1.40B | 2.69B | -32.34M | 519.98M |
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 |
|---|---|---|---|---|---|---|---|
65 Neutral | $2.17B | 12.19 | 3.79% | 4.94% | 3.15% | 1.96% | |
64 Neutral | $3.15B | 4.80 | 16.91% | 16.19% | 136.45% | 234.34% | |
62 Neutral | $2.33B | 4.42 | 18.52% | 17.70% | 34.24% | ― | |
57 Neutral | $822.32M | 6.59 | 8.88% | 16.43% | 16.63% | 96.52% | |
53 Neutral | $1.27B | -16.67 | -1.23% | 11.24% | 18.52% | 78.83% | |
52 Neutral | $866.87M | 8.28 | 6.88% | 42.82% | 3.09% | ― | |
49 Neutral | $1.04B | -23.55 | 0.75% | 13.12% | 10.27% | -151.66% |
* Real Estate Sector Average
DX
Dynex Capital
12.71
1.95
18.09%
ARI
Apollo Real Estate
6.62
0.69
11.71%
ARR
ARMOUR Residential REIT
16.47
2.32
16.40%
CIM
Chimera Investment
12.48
0.44
3.64%
TWO
Two Harbors
12.09
3.29
37.34%
PMT
PennyMac Mortgage
9.43
-1.13
-10.74%
Dynex Capital Corporate Events
Business Operations and StrategyPrivate Placements and FinancingRegulatory Filings and Compliance
Dynex Capital Expands At-The-Market Equity Program
Positive
Jul 28, 2026
On July 28, 2026, Dynex Capital, Inc. amended its existing at-the-market equity distribution agreement with a syndicate of major investment banks, increasing the total number of common shares authorized for sale to 301,292,973, of which 99,326,438...
Business Operations and StrategyExecutive/Board Changes
Dynex Capital Adds Independent Director to Strengthen Governance
Positive
Jun 16, 2026
Dynex Capital, Inc., an internally managed mortgage real estate investment trust listed on the NYSE under the ticker DX, invests in high-quality mortgage assets backed by U.S. residential and commercial real estate and emphasizes disciplined risk ...
Business Operations and StrategyRegulatory Filings and ComplianceShareholder Meetings
Dynex Capital Doubles Authorized Shares, Bolstering Capital Flexibility
Positive
May 22, 2026
At its May 21, 2026 annual meeting, Dynex Capital shareholders approved an amendment to the company’s articles of incorporation to double the number of authorized common shares from 360 million to 720 million, with the change becoming effect...
Business Operations and StrategyPrivate Placements and Financing
Dynex Capital Expands ATM Equity Distribution With New Agents
Positive
Apr 28, 2026
On April 28, 2026, Dynex Capital, Inc. amended its existing at-the-market equity distribution agreement, originally established in 2018 and subsequently updated multiple times, to further refine the terms under which its common stock may be sold t...
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.