MFA Financial (MFA) AI Stock Analysis

• Market Cap: $948.38M
• Dividend Yield: 15.71%
• Average Volume (3M): 1.30M
• Price to Earnings (P/E): 10.9
• Beta (1Y): 0.53
• Revenue Growth: 5.52%
• EPS Growth: -47.72%
• Country: US
• Employees: 348
• Sector: Real Estate
• Sector Strength: 53
• Industry: REIT - Mortgage
• EPS (TTM): 0.20
• Shares Outstanding: 102,195,700
• 10 Day Avg. Volume: 1,318,693
• 30 Day Avg. Volume: 1,300,267
• PEG Ratio: 0.11
• Price to Book (P/B): 0.57
• Price to Sales (P/S): 4.17
• P/FCF Ratio: 5.27
• Enterprise Value/Market Cap: 10.89
• Enterprise Value/Revenue: 27.78
• Enterprise Value/Gross Profit: 30.27
• Enterprise Value/Ebitda: 62.90
• 1Y Price Target: $10.08
• Price Target Upside: 11.88% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): 1.1
• Revenue Forecast (FY): $265.05M

• Rating: 62 Neutral
• Price Target: ―

MFA Financial's overall score reflects a balanced view of its strengths and weaknesses. The company shows solid valuation and dividend yield, appealing to income investors. However, concerns about operational challenges and fluctuating cash flows limit upside potential. The technical indicators suggest cautious optimism, while the earnings call highlights both growth initiatives and ongoing challenges.

Positive Factors

Asset Growth

The increase in assets reflects MFA's ability to expand its portfolio, enhancing its capacity to generate income and improve long-term financial stability.

Successful Securitizations

Successful securitizations demonstrate MFA's effective capital management and ability to leverage its assets, supporting liquidity and financial performance.

Dividend Stability

Stable dividends indicate a commitment to returning value to shareholders, enhancing investor confidence and supporting long-term investment appeal.

Negative Factors

Economic Book Value Decline

A decline in economic book value suggests potential challenges in asset valuation and profitability, impacting the company's financial health and investor perception.

Increased Delinquencies

Rising delinquencies can signal deteriorating asset quality, potentially leading to higher credit losses and affecting long-term financial performance.

Challenges in Loan Origination

Lower-than-expected loan origination may indicate operational challenges, limiting growth opportunities and affecting revenue generation in the long term.

MFA Financial Business Overview & Revenue Model

Company Description

MFA Financial, Inc., together with its subsidiaries, operates as a real estate investment trust (REIT) in the United States. The company invests in residential mortgage assets, including non-agency mortgage-backed securities (MBS), agency MBS, and credit risk transfer securities; residential whole loans, including purchased performing loans, purchased credit deteriorated, and non-performing loans; and mortgage servicing rights related assets. The company has elected to be taxed as a REIT and would not be subject to federal income taxes if it distributes at least 90% of its taxable income to its stockholders. MFA Financial, Inc. was incorporated in 1997 and is headquartered in New York, New York.

How the Company Makes Money

MFA Financial makes money by investing in residential mortgage assets and earning income from these investments. The company's revenue model centers around acquiring and managing a portfolio of residential whole loans and mortgage-backed securities, which generate interest income. MFA leverages its expertise in managing mortgage credit risk to maximize returns. The company also benefits from the capital appreciation of its real estate assets. Additionally, MFA Financial engages in securitization and other financial transactions to enhance its liquidity and financial performance. Key revenue streams include interest income from mortgage investments, gains from the sale of mortgage-backed securities, and income generated from securitization activities. Significant partnerships with financial institutions and access to capital markets further contribute to its earnings and operational efficiency.

MFA Financial Financial Statement Overview

Summary

MFA Financial shows a mixed financial performance with strengths in net income improvement and a solid balance sheet. However, the absence of revenue growth in 2024 and fluctuating cash flows due to strategic adjustments raise concerns about future profitability.

Income Statement

The income statement reveals fluctuating revenues and profitability. Total revenue has been inconsistent, with a significant decline in 2024 to zero, probably due to accounting adjustments or extraordinary items. The net income has shown improvement, turning positive in recent years after a substantial loss in 2020. However, the absence of EBIT and EBITDA metrics in 2024 makes it challenging to assess operational efficiency.

Balance Sheet

The balance sheet highlights a strong equity position relative to liabilities, with stockholders' equity remaining stable. The debt-to-equity ratio has improved significantly as total debt was eliminated by 2024, contributing to a safer financial structure. The equity ratio is moderate, reflecting a balanced capital structure. However, a decline in total assets suggests potential downsizing or asset divestitures.

Cash Flow

Cash flow analysis shows positive free cash flow and operating cash flow over the years, indicating good liquidity. The operating cash flow to net income ratio is robust, suggesting efficient cash generation relative to earnings. However, cash flow from investing activities has been negative, likely due to strategic reinvestments or asset sales.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	371.82M	279.61M	234.05M	-67.62M	337.22M	-555.87M
Gross Profit	341.18M	244.30M	199.91M	-110.52M	299.75M	-555.87M
EBITDA	164.20M	0.00	0.00	0.00	433.02M	0.00
Net Income	128.17M	119.25M	80.16M	-231.58M	328.87M	-679.39M
Balance Sheet
Total Assets	12.10B	11.41B	10.77B	9.11B	9.14B	6.93B
Cash, Cash Equivalents and Short-Term Investments	305.17M	338.93M	318.00M	334.18M	304.70M	814.35M
Total Debt	6.60B	9.20B	5.00B	6.86B	3.15B	1.84B
Total Liabilities	10.28B	9.57B	8.87B	7.12B	6.60B	4.41B
Stockholders Equity	1.82B	1.84B	1.90B	1.99B	2.54B	2.52B
Cash Flow
Free Cash Flow	150.07M	200.12M	108.74M	365.78M	108.25M	33.53M
Operating Cash Flow	150.07M	200.12M	108.74M	366.08M	120.29M	38.40M
Investing Cash Flow	-795.83M	-424.60M	-1.55B	-1.13B	-2.17B	6.38B
Financing Cash Flow	679.82M	337.58M	1.43B	850.21M	1.63B	-5.74B

MFA Financial Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 9.01
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MFA, the sentiment is Negative. The current price of 9.01 is below the 20-day moving average (MA) of 9.14, below the 50-day MA of 9.23, and below the 200-day MA of 9.15, indicating a bearish trend. The MACD of >-0.01 indicates Negative momentum. The RSI at 43.61 is Neutral, neither overbought nor oversold. The STOCH value of 42.59 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MFA.

MFA Financial Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
ORC	65 Neutral	$1.10B	14.94	7.02%	19.89%	72.30%	-54.02%
CIM	63 Neutral	$1.00B	―	2.10%	12.47%	9.46%	-111.44%
MFA	62 Neutral	$948.38M	10.91	6.90%	15.71%	5.52%	-47.72%
PMT	58 Neutral	$1.08B	13.60	6.37%	12.94%	-15.48%	-36.45%
FBRT	56 Neutral	$816.07M	12.53	5.88%	14.20%	-0.93%	-1.92%
TWO	54 Neutral	$997.81M	―	-9.69%	17.01%	22.48%	50.49%

MFA Financial Corporate Events

MFA Financial Appoints Christopher Small to Board

On March 4, 2025, MFA Financial, Inc. announced the election of Christopher Small to its Board of Directors, filling the vacancy left by the passing of Francis J. Oelerich III in December 2024. Mr. Small, with extensive experience in investment banking and capital markets, will also serve on the Audit and Compensation Committees, bringing valuable expertise to MFA’s Board, management team, and stockholders.

MFA Financial Reports 2024 Year-End Financial Results

MFA Financial, Inc. announced its financial results for the fourth quarter and full year of 2024, revealing a GAAP net income to common stockholders of $86.4 million for the year, up from $47.3 million in 2023. Despite a challenging fourth quarter with a total economic return of -1.2%, the company leveraged market conditions to acquire $1.2 billion in loans and securities, positioning itself for future growth. Key activities in 2024 included the acquisition of $2.6 billion in loans, eight loan securitizations, and expanding its Agency MBS portfolio to $1.4 billion. The company also navigated leadership changes and issued $190 million of senior unsecured notes, enhancing its strategic positioning for 2025.