MFA Financial (MFA)
NYSE:MFA
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MFA Financial
(NYSE:MFA)
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Rating:67Neutral
Price Target:
$11.00
▲(7.53% Upside)
Action:ReiteratedDate:02/21/26
Overall score reflects attractive valuation (low P/E and high dividend yield) and improving/positive technical momentum, offset by only moderate financial-quality strength due to historical earnings/leverage volatility and uneven cash-flow consistency. Earnings call commentary is constructive but still tempered by legacy credit headwinds and timing uncertainty.
Positive Factors
Active capital deployment
Large, sustained capital deployment ($1.9B in Q4) meaningfully reduces excess cash drag and shifts portfolio into higher-yielding mortgage assets. Continued disciplined deployment supports recurring net interest income, levered ROE improvement and the ability to convert liquidity into long‑term distributable earnings.
Negative Factors
Legacy credit and delinquencies
Persistently elevated delinquencies, especially in legacy multifamily, create uncertain timing and quantum of credit realizations. That uncertainty undermines distributable earnings and can consume capital and management bandwidth for multiple quarters, making near‑term earnings and dividend durability less predictable.
Read all positive and negative factors
Positive Factors
Negative Factors
Active capital deployment
Large, sustained capital deployment ($1.9B in Q4) meaningfully reduces excess cash drag and shifts portfolio into higher-yielding mortgage assets. Continued disciplined deployment supports recurring net interest income, levered ROE improvement and the ability to convert liquidity into long‑term distributable earnings.
Read all positive factors
MFA Financial (MFA) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.06B
Dividend Yield14.9%
Average Volume (3M)1.39M
Price to Earnings (P/E)5.5
Beta (1Y)0.50
Revenue Growth-17.08%
EPS Growth57.97%
CountryUS
Employees348
SectorReal Estate
Sector Strength53
IndustryREIT - Mortgage
Share Statistics
EPS (TTM)0.27
Shares Outstanding102,093,864
10 Day Avg. Volume1,242,011
30 Day Avg. Volume1,390,116
Financial Highlights & Ratios
PEG Ratio0.05
Price to Book (P/B)0.53
Price to Sales (P/S)1.10
P/FCF Ratio12.66
Enterprise Value/Market Cap11.20
Enterprise Value/Revenue28.29
Enterprise Value/Gross Profit24.24
Enterprise Value/Ebitda34.64
Forecast
1Y Price Target
$11.00Price Target Upside7.53% Upside
Rating ConsensusHold
Number of Analyst Covering2
EPS Forecast (FY)1.37
Revenue Forecast (FY)$294.59M
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...
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 securitie...
MFA Financial Earnings Call Summary
Earnings Call Date:Feb 18, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 05, 2026
Earnings Call Sentiment Positive
The call balanced clear operational progress and constructive market tailwinds against lingering legacy credit issues and timing uncertainty. Management reported solid returns (3.1% Q4 TER, 9% FY TER), meaningful asset redeployments ($1.9B in Q4), significant cost reductions (~9.5% FY G&A decline), and multiple strategic initiatives at Lima One and across securitizations that should unlock capital and improve ROE. Headwinds include a Q4 uptick in delinquency driven by legacy multifamily defaults (portfolio held at a $42M discount), modest near‑term proceeds from preferred issuance, and temporary NII and credit volatility. Overall, the positives — improved market backdrop, active capital deployment, expense discipline and tangible near‑term liquidity levers — outweigh the remaining legacy credit and timing drawbacks.Positive Updates
Strong Total Economic and Shareholder Returns
Total economic return (TER) of 3.1% in Q4 2025 and 9% for the full year; total shareholder return for 2025 of 6%. Management expects DE to reconverge with the dividend by back half of 2026.
Negative Updates
Credit and Delinquency Pressure in Legacy Multifamily
Overall loan delinquency ended 2025 just over 7% (down from 7.5% a year earlier) but increased ~30 basis points in Q4 driven by defaults in the legacy multifamily transitional portfolio; that legacy book is accounted for at a $42 million discount to par, with remaining timing and losses uncertain.
Read all updates
Q4-2025 Updates
Positive
Negative
Strong Total Economic and Shareholder Returns
Total economic return (TER) of 3.1% in Q4 2025 and 9% for the full year; total shareholder return for 2025 of 6%. Management expects DE to reconverge with the dividend by back half of 2026.
Read all positive updates
Company Guidance
Management guided that they expect distributable earnings (DE) to reconverge with the $1.44 annual common dividend (about a 10.5% dividend on book value) in the back half of 2026, with DE running from roughly 8–9% in 2025 toward about 10–11% by late‑2026 and redeployed capital targeted to earn mid‑teens ROEs; they highlighted tangible near‑term liquidity and capital actions (over $100M of excess cash already deployed, $1.9B of Q4 purchases including $1.2B agencies, $443M non‑QM, Lima One originations of $226M) and said calling/re‑securitizing several deals (about $2.3B of currently callable securitized debt) could unlock $50–100M of capital this year, noting they resolved >$150M of delinquent loans in Q4 that can be redeployed at mid‑teen ROEs; operational targets include further G&A reductions (2025 G&A $119.4M vs $131.9M in 2024, ~9.5% decline), continued Lima One growth (Q4 mortgage banking income $5.7M) and ongoing preferred issuances (sold ~163k Series C / ~53k Series B for ~$5M) to fund accretive common buybacks (~540k shares repurchased at a ~33% discount to economic book value).MFA Financial Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
48
Neutral
Cash Flow
44
Neutral
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 875.24M | 279.61M | 234.05M | -67.62M | 337.22M |
| Gross Profit | 841.79M | 244.30M | 199.91M | -110.52M | 299.75M |
| EBITDA | 690.03M | 0.00 | 0.00 | 0.00 | 433.02M |
| Net Income | 176.78M | 119.25M | 80.16M | -231.58M | 328.87M |
Balance Sheet | |||||
| Total Assets | 13.05B | 11.41B | 10.77B | 9.11B | 9.14B |
| Cash, Cash Equivalents and Short-Term Investments | 213.21M | 338.93M | 318.00M | 334.18M | 304.70M |
| Total Debt | 10.99B | 9.20B | 5.00B | 6.86B | 3.15B |
| Total Liabilities | 11.22B | 9.57B | 8.87B | 7.12B | 6.60B |
| Stockholders Equity | 1.83B | 1.84B | 1.90B | 1.99B | 2.54B |
Cash Flow | |||||
| Free Cash Flow | 76.25M | 200.12M | 108.74M | 365.78M | 108.25M |
| Operating Cash Flow | 76.25M | 200.12M | 108.74M | 366.08M | 120.29M |
| Investing Cash Flow | -1.79B | -424.60M | -1.55B | -1.13B | -2.17B |
| Financing Cash Flow | 1.49B | 337.58M | 1.43B | 850.21M | 1.63B |
MFA Financial Technical Analysis
Positive
10.23
Price Trends
9.63
Positive
9.38
Positive
8.97
Positive
Market Momentum
0.16
Negative
63.70
Neutral
85.51
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 10.23 is above the 20-day moving average (MA) of 9.68, above the 50-day MA of 9.63, and above the 200-day MA of 8.97, indicating a bullish trend. The MACD of 0.16 indicates Negative momentum. The RSI at 63.70 is Neutral, neither overbought nor oversold. The STOCH value of 85.51 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MFA.
MFA Financial Risk Analysis
MFA Financial disclosed 67 risk factors in its most recent earnings report. MFA Financial 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 2 New Risks
1.
We may utilize artificial intelligence, which exposes us to liability and affects our business. Q4, 2025
2.
Litigation may adversely affect our business and financial results. Q4, 2025
MFA Financial Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
67 Neutral | $1.06B | 5.46 | 9.66% | 14.90% | -17.08% | 57.97% | |
65 Neutral | $2.17B | 12.19 | 3.79% | 4.94% | 3.15% | 1.96% | |
59 Neutral | $738.41M | 9.99 | 5.60% | 13.31% | 0.58% | -20.40% | |
57 Neutral | $1.44B | -16.67 | 10.87% | 20.03% | 81.33% | 86.84% | |
55 Neutral | $1.05B | 8.54 | 6.79% | 12.69% | 28.71% | -27.87% | |
53 Neutral | $1.14B | 4.43 | 8.85% | 11.40% | 10.43% | 59.94% | |
51 Neutral | $1.16B | ― | -23.93% | 14.29% | -10.44% | -301.75% |
* Real Estate Sector Average
MFA
MFA Financial
10.29
1.78
20.96%
CIM
Chimera Investment
13.72
2.81
25.78%
TWO
Two Harbors
11.01
0.14
1.32%
PMT
PennyMac Mortgage
12.21
0.93
8.21%
ORC
Orchid Island Capital
7.13
1.13
18.81%
FBRT
Franklin BSP Realty Trust
9.19
-1.06
-10.31%
MFA Financial Corporate Events
Business Operations and StrategyStock BuybackFinancial Disclosures
MFA Financial Posts Strong Q4 Results, Expands Portfolio
Positive
Feb 18, 2026
On February 18, 2026, MFA Financial reported fourth-quarter 2025 GAAP net income of $43.6 million, or $0.42 per share, distributable earnings of $27.8 million, and a total economic return of 3.1%, while ending the year with GAAP book value of $13....
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.