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Federal National Mortgage Association
(OTC:FNMA)
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Rating:65Neutral
Price Target:
$7.00
▼(-15.25% Downside)
Action:Reiterated
Date:04/29/26
The score is driven mainly by solid financial performance with notable revenue growth but constrained by high leverage and cash-flow volatility. Valuation is a key positive due to the very low P/E, while technicals are mixed with improving near-term trend but weaker longer-term trend. Corporate events provide a small incremental positive from liability management and leadership continuity.
Positive Factors
Business model & scale
Fannie Mae’s role as a GSE creating liquidity for conforming mortgages is structurally durable: recurring guarantee fees and deep relationships with originators, servicers and MBS investors create stable fee-based economics that persist across housing cycles.
Negative Factors
Very high leverage
Fannie Mae’s extremely high leverage (~38x debt/equity) is intrinsic to mortgage finance but materially raises sensitivity to funding spreads, interest-rate moves and asset-quality shocks. High leverage constrains flexibility and amplifies downside in stressed markets.
Read all positive and negative factors
Positive Factors
Negative Factors
Business model & scale
Fannie Mae’s role as a GSE creating liquidity for conforming mortgages is structurally durable: recurring guarantee fees and deep relationships with originators, servicers and MBS investors create stable fee-based economics that persist across housing cycles.
Read all positive factors
Federal National Mortgage Association (FNMA) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$7.33B
Dividend YieldN/A
Average Volume (3M)4.40M
Price to Earnings (P/E)3.8
Beta (1Y)1.00
Revenue Growth3.85%
EPS Growth169.77%
CountryUS
Employees8,200
SectorFinancial
Sector Strength70
IndustryFinancial - Mortgages
Share Statistics
EPS (TTM)1.60
Shares Outstanding1,158,087,500
10 Day Avg. Volume3,181,973
30 Day Avg. Volume4,397,110
Financial Highlights & Ratios
PEG Ratio35.77
Price to Book (P/B)0.58
Price to Sales (P/S)0.39
P/FCF Ratio2.62
Enterprise Value/Market Cap568.65
Enterprise Value/Revenue25.97
Enterprise Value/Gross Profit26.59
Enterprise Value/Ebitda27.96
Forecast
1Y Price Target
$8.63Price Target Upside4.42% Upside
Rating ConsensusHold
Number of Analyst Covering5
EPS Forecast (FY)2.54
Revenue Forecast (FY)$29.61B
Federal National Mortgage Association Business Overview & Revenue Model
Company Description
The Federal National Mortgage Association, commonly known as Fannie Mae, was established in 1938 and has its headquarters in Washington, D.C. Its fundamental purpose is to facilitate the flow of capital in the United States mortgage market, ensuri...
How the Company Makes Money
Fannie Mae primarily makes money by (1) guaranteeing mortgage-backed securities and (2) earning investment-related income from its retained mortgage and securities portfolio, along with (3) fees and other ancillary income related to its housing fi...
Federal National Mortgage Association Earnings Call Summary
Earnings Call Date:Oct 29, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Aug 04, 2026
Earnings Call Sentiment Neutral
The earnings call highlighted strong quarterly net income growth and liquidity support for the housing market, but also noted challenges such as a decline in year-on-year income and multifamily credit issues. Despite these challenges, the overall performance showed resilience and strategic growth in key areas.Positive Updates
Increase in Net Income
Fannie Mae reported $3.9 billion of net income for the third quarter, which is up 16% from the second quarter.
Negative Updates
Year-on-Year Income Decline
Net income decreased by 5% year-on-year due to changes in provision for credit loss.
Read all updates
Q3-2025 Updates
Positive
Negative
Increase in Net Income
Fannie Mae reported $3.9 billion of net income for the third quarter, which is up 16% from the second quarter.
Read all positive updates
Company Guidance
During the third quarter of 2025, Fannie Mae reported a net income of $3.9 billion, representing a 16% increase compared to the second quarter, but a 5% decrease year-on-year, largely influenced by changes in credit loss provisions. The company's guarantee book stood at $4.1 trillion, which contributed to stable guarantee fee revenues, leading to net revenues of $7.3 billion. Fannie Mae's net worth rose to $105.5 billion, and its illustrative return on required equity increased to 10.3%. The company provided $109 billion in liquidity to the mortgage market, aiding over 400,000 households, with around 207,000 being first-time homebuyers. The provision for credit losses and noninterest expenses saw reductions, which positively impacted net income, though these gains were partially offset by lower fair value gains. The average net interest margin remained stable at 66 basis points. Credit performance was stable, despite a slight increase in delinquencies within the multifamily sector. Cost management initiatives led to an 8% decrease in noninterest expenses from the prior quarter. The company continues to build its capital, with a regulatory capital deficit of $25.4 billion, needing $190 billion to meet total capital requirements. The single-family business accounted for 87% of the guarantee book and 83% of net revenues, showing strong results with reduced provision for credit losses and noninterest expenses. Multifamily net income increased by 33% from the previous quarter, driven by lower credit loss provisions and higher revenues. Overall, the quarter underscored the strength of Fannie Mae's earnings and its commitment to building regulatory capital and supporting the housing market.Federal National Mortgage Association Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
52
Neutral
Cash Flow
61
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 160.50B | 160.56B | 151.36B | 140.94B | 116.81B | 100.33B |
| Gross Profit | 156.75B | 156.81B | 147.59B | 137.51B | 113.44B | 97.26B |
| EBITDA | 149.08B | 147.99B | 143.09B | 132.90B | 107.11B | 98.04B |
| Net Income | 14.42B | 14.36B | 16.98B | 17.41B | 12.92B | 22.18B |
Balance Sheet | ||||||
| Total Assets | 4.31T | 4.32T | 4.35T | 4.33T | 4.31T | 4.23T |
| Cash, Cash Equivalents and Short-Term Investments | 45.26B | 81.34B | 78.81B | 68.71B | 123.38B | 43.28B |
| Total Debt | 4.17T | 4.18T | 4.23T | 4.22T | 4.22T | 4.16T |
| Total Liabilities | 4.20T | 4.21T | 4.26T | 4.25T | 4.25T | 4.18T |
| Stockholders Equity | 112.67B | 109.01B | 94.66B | 77.68B | 60.28B | 47.36B |
Cash Flow | ||||||
| Free Cash Flow | 26.30B | 23.99B | -10.52B | 11.88B | 41.13B | 47.21B |
| Operating Cash Flow | 26.30B | 23.99B | -10.52B | 11.88B | 43.83B | 47.21B |
| Investing Cash Flow | 206.28B | 186.90B | 157.79B | 99.15B | 90.13B | 90.85B |
| Financing Cash Flow | -224.84B | -206.85B | -137.17B | -130.17B | -154.74B | -145.05B |
Federal National Mortgage Association Technical Analysis
Negative
8.26
Price Trends
6.99
Negative
6.92
Negative
8.68
Negative
Market Momentum
-0.21
Positive
43.67
Neutral
33.90
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FNMA, the sentiment is Negative. The current price of 8.26 is above the 20-day moving average (MA) of 6.44, above the 50-day MA of 6.99, and below the 200-day MA of 8.68, indicating a bearish trend. The MACD of -0.21 indicates Positive momentum. The RSI at 43.67 is Neutral, neither overbought nor oversold. The STOCH value of 33.90 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for FNMA.
Federal National Mortgage Association Risk Analysis
Federal National Mortgage Association disclosed 36 risk factors in its most recent earnings report. Federal National Mortgage Association 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
Federal National Mortgage Association Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
65 Neutral | $7.33B | 3.84 | 13.45% | ― | 3.85% | 169.77% | |
57 Neutral | $4.28B | 8.33 | 12.02% | 0.90% | 24.55% | 43.82% | |
54 Neutral | $3.33B | 7.50 | 33.91% | 8.64% | 37.10% | ― | |
51 Neutral | $40.72B | 214.33 | 1.53% | ― | 73.75% | 269.75% |
* Financial Sector Average
FNMA
Federal National Mortgage Association
6.15
-2.98
-32.64%
PFSI
PennyMac Financial
81.48
-18.23
-18.28%
UWMC
UWM Holding
2.00
-1.80
-47.31%
RKT
Rocket Companies
13.91
-0.04
-0.29%
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.