MFA Financial (MFA) AI Stock Analysis

• Market Cap: $1.03B
• Dividend Yield: 14.16%
• Average Volume (3M): 1.19M
• Price to Earnings (P/E): 11.5
• Beta (1Y): 0.76
• Revenue Growth: -7.70%
• EPS Growth: 40.36%
• Country: US
• Employees: 348
• Sector: Real Estate
• Sector Strength: 52
• Industry: REIT - Mortgage
• EPS (TTM): 0.24
• Shares Outstanding: 102,668,700
• 10 Day Avg. Volume: 959,946
• 30 Day Avg. Volume: 1,189,112
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 9.67
• Enterprise Value/Revenue: 27.79
• Enterprise Value/Gross Profit: 28.69
• Enterprise Value/Ebitda: 60.96
• 1Y Price Target: $10.33
• Price Target Upside: 2.99% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 5

• 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

MFA added $463M of Agency MBS, increasing the portfolio to a total of $1.4B, showing strategic growth in assets.

Dividend Yield

Carries highest dividend yield among non-Agency lenders.

Portfolio Expansion

The company acquired $470M of non-qualified mortgage residential loans with an average coupon of 7.8%, expanding its portfolio significantly.

Negative Factors

Delinquencies

Delinquencies have risen, but leverage looks supportive of non-QM prepayment risk at these spread levels.

Input Costs

Confronting tariffs and higher input costs creates a wider range around the timing of the draws as it raises some of the execution and development risk.

Interest Spread

The company’s net interest spread declined by 12 basis points to 2.14%, reflecting the impact of high funding costs.

MFA Financial Business Overview & Revenue Model

Company Description

MFA Financial, Inc. (MFA) is a leading real estate investment trust (REIT) that focuses on investing in residential mortgage assets. The company operates within the financial sector, specifically targeting the residential mortgage market. MFA Financial manages a diversified portfolio that includes residential whole loans, mortgage-backed securities, and other real estate-related assets. Its primary objective is to generate attractive risk-adjusted returns for its shareholders through a combination of dividends and capital appreciation.

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	360.21M	252.85M	234.05M	195.85M	337.22M	-555.87M
Gross Profit	348.83M	252.85M	199.91M	143.76M	299.75M	-1.11B
EBITDA	164.20M	0.00	0.00	0.00	433.02M	-679.39M
Net Income	128.25M	119.25M	80.16M	-247.34M	328.87M	-679.39M
Balance Sheet
Total Assets	11.67B	11.41B	10.77B	9.11B	9.14B	6.93B
Cash, Cash Equivalents and Short-Term Investments	275.73M	338.93M	318.00M	334.18M	304.70M	814.35M
Total Debt	0.00	6.02B	5.00B	3.63B	2.92B	1.84B
Total Liabilities	9.85B	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	124.07M	200.12M	108.74M	365.78M	108.25M	33.53M
Operating Cash Flow	124.07M	200.12M	108.74M	366.08M	120.29M	38.40M
Investing Cash Flow	-433.98M	-424.60M	-1.55B	-1.13B	-2.17B	6.38B
Financing Cash Flow	313.44M	337.58M	1.43B	850.21M	1.63B	-5.74B

MFA Financial Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 10.03
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MFA, the sentiment is Positive. The current price of 10.03 is above the 20-day moving average (MA) of 9.58, above the 50-day MA of 9.45, and above the 200-day MA of 9.50, indicating a bullish trend. The MACD of 0.19 indicates Negative momentum. The RSI at 63.63 is Neutral, neither overbought nor oversold. The STOCH value of 82.91 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MFA.

MFA Financial Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FBRT	74 Outperform	$933.00M	11.53	6.74%	12.51%	-3.60%	19.31%
EFC	69 Neutral	$1.39B	11.43	8.81%	11.31%	20.32%	1.58%
CIM	63 Neutral	$1.14B	11.17	7.32%	10.55%	4.83%	-25.07%
Sector *	63 Neutral	$7.00B	13.45	-0.52%	6.98%	3.61%	-22.78%
MFA	62 Neutral	$1.03B	11.50	6.90%	14.16%	-7.70%	40.36%
DX	60 Neutral	$1.63B	15.88	4.93%	15.05%	35.01%	1115.85%
RC	46 Neutral	$672.10M	―	-13.92%	17.77%	-34.48%	-373.29%

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.