Annaly Capital (NLY) AI Stock Analysis

• Market Cap: $16.52B
• Dividend Yield: 12.4%
• Average Volume (3M): 7.81M
• Price to Earnings (P/E): 7.9
• Beta (1Y): 0.61
• Revenue Growth: 17.14%
• EPS Growth: N/A
• Country: US
• Employees: 191
• Sector: Real Estate
• Sector Strength: 53
• Industry: REIT - Mortgage
• EPS (TTM): 0.74
• Shares Outstanding: 718,386,960
• 10 Day Avg. Volume: 6,809,444
• 30 Day Avg. Volume: 7,812,316
• PEG Ratio: 0.09
• Price to Book (P/B): 0.89
• Price to Sales (P/S): 2.14
• P/FCF Ratio: -64.36
• Enterprise Value/Market Cap: 7.65
• Enterprise Value/Revenue: 23.18
• Enterprise Value/Gross Profit: 32.00
• Enterprise Value/Ebitda: 18.40
• 1Y Price Target: $24.72
• Price Target Upside: 7.38% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 9
• EPS Forecast (FY): 3.02
• Revenue Forecast (FY): $2.37B

• Rating: 59 Neutral
• Price Target: $24.00 ▲(4.26% Upside)

The score is held back primarily by elevated balance-sheet leverage (debt-to-equity ~7.0x) and a sharp drop in operating/free cash flow in 2025 despite the earnings rebound. Offsetting factors include attractive valuation/income (P/E 7.75; ~12.37% yield) and a positive earnings-call outlook with dividend coverage, while technical signals are mixed-to-weak near term (negative MACD; RSI ~44.7; below 20/50 DMA).

Positive Factors

Scale and Agency MBS franchise

A $93B agency MBS base that is 62% of capital gives durable scale and liquidity advantages. Large agency exposure reduces idiosyncratic credit risk, supports market access for repo financing, and enables meaningful net interest income generation across rate cycles.

Diversified platform: residential credit and MSR growth

Growing residential credit and MSR businesses materially diversify earnings away from pure agency spread exposure. Record correspondent activity and rising MSR scale create multiple fee and spread engines, lowering reliance on a single asset class and improving long-term earnings resilience.

Improved funding profile and liquidity cushion

Ample unencumbered assets (~$7.8B) and ~$9.4B available for financing plus lower repo costs provide durable funding flexibility. This reduces rollover and liquidity stress risk for a leveraged mREIT and supports steady deployment and dividend coverage through funding cycles.

Negative Factors

Elevated balance-sheet leverage

Debt-to-equity near 7x markedly increases refinancing and market-value risk for a mortgage REIT. High leverage amplifies the impact of spread widening or funding cost increases, constraining capital flexibility and raising the probability that adverse rate moves impair book value or distributable income.

Weakened cash generation

A sharp drop in operating and free cash flow reduces internal funding for capital needs and dividends, increasing dependence on external equity or repo markets. For a highly leveraged mREIT, sustained weaker cash conversion undermines balance sheet repair and long-term dividend reliability.

Policy/GSE and prepayment risk

Regulatory/GSE policy shifts or changes to G-fees materially alter MBS economics and prepayment behavior. Such structural policy risk can change origination incentives, MSR valuations, and spread dynamics, creating persistent uncertainty that can depress returns across the firm's core businesses.

Annaly Capital Business Overview & Revenue Model

Company Description

Annaly Capital Management, Inc., a diversified capital manager, engages in mortgage finance and corporate middle market lending. The company invests in agency mortgage-backed securities, mortgage servicing rights, Agency commercial mortgage-backed securities, non-Agency residential mortgage assets, residential mortgage loans, credit risk transfer securities, corporate debts, and other commercial real estate investments. It has elected to be taxed as a real estate investment trust (REIT). As a REIT, it is not subject to federal income tax to the extent that it distributes its taxable income to its shareholders. The company was founded in 1996 and is based in New York, New York.

How the Company Makes Money

Annaly Capital generates revenue primarily through the interest income earned on its mortgage-backed securities and other real estate-related assets. The company leverages its investments by borrowing at lower short-term interest rates and investing in higher-yielding long-term mortgage assets, a strategy known as the 'spread' model. This allows Annaly to profit from the difference between the interest income received from its assets and the cost of financing its investments. Additionally, the company may also earn income from asset management fees and other related services. Significant factors contributing to its earnings include interest rate fluctuations, the overall health of the housing market, and the company's effective risk management strategies. Annaly has established partnerships with various financial institutions and investors, enhancing its ability to optimize its portfolio and access capital.

Annaly Capital Financial Statement Overview

Summary

Income statement rebounded in 2025 (revenue up ~51% YoY and ~$2.0B net income), but results are highly cyclical. The balance sheet is the key drag: debt rose to ~$111.9B and debt-to-equity jumped to ~7.0x, materially increasing risk. Cash flow also weakened sharply in 2025 with operating cash flow down to ~$0.7B and free cash flow down ~65% YoY.

Income Statement

Results show a sharp rebound in 2025 with revenue up ~51% year over year and a return to solid profitability (net income ~$2.0B). However, earnings and revenue have been volatile over the cycle, including a loss year in 2023 and negative revenue in 2020, which reduces confidence in consistency. Reported margins swing widely across years, reinforcing that profitability is highly rate/spread sensitive rather than steady.

Balance Sheet

Leverage has risen materially: total debt increased to ~$111.9B in 2025 with debt-to-equity at ~7.0x (vs. ~1.7x in 2024 and ~1.2x in 2023). While equity is positive (~$16.1B) and 2025 return on equity improved (~12.6%), the balance sheet is meaningfully more leveraged than prior years, which elevates refinancing and market-value risk for a mortgage REIT.

Cash Flow

Cash generation weakened in 2025: operating cash flow fell to ~$0.7B (down sharply from ~$3.3B in 2024), and free cash flow declined ~65% year over year. Free cash flow still covers reported net income in 2025 (per provided ratio), but the magnitude and direction of the cash flow drop are a concern, especially alongside higher leverage.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	6.70B	1.25B	-1.40B	2.00B	2.88B
Gross Profit	6.69B	1.20B	-1.44B	1.97B	2.87B
EBITDA	6.87B	5.65B	2.27B	3.10B	2.67B
Net Income	2.03B	1.00B	-1.64B	1.73B	2.39B
Balance Sheet
Total Assets	135.61B	103.56B	93.23B	81.85B	76.76B
Cash, Cash Equivalents and Short-Term Investments	2.04B	2.35B	4.49B	152.55M	119.58M
Total Debt	111.86B	21.45B	13.20B	8.80B	7.11B
Total Liabilities	119.45B	90.86B	81.88B	70.48B	63.57B
Stockholders Equity	16.09B	12.61B	11.26B	11.27B	13.17B
Cash Flow
Free Cash Flow	-222.16M	2.45B	1.97B	4.36B	2.54B
Operating Cash Flow	692.91M	3.31B	2.37B	5.37B	3.08B
Investing Cash Flow	-27.36B	-14.98B	-8.42B	-14.53B	4.90B
Financing Cash Flow	27.22B	11.75B	5.88B	9.39B	-7.88B

Annaly Capital Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 23.02
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NLY, the sentiment is Positive. The current price of 23.02 is below the 20-day moving average (MA) of 23.23, below the 50-day MA of 23.07, and above the 200-day MA of 20.72, indicating a neutral trend. The MACD of -0.09 indicates Positive momentum. The RSI at 47.69 is Neutral, neither overbought nor oversold. The STOCH value of 66.98 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NLY.

Annaly Capital Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AGNC	66 Neutral	$12.13B	7.67	15.08%	13.98%	729.50%	-53.65%
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
DX	64 Neutral	$2.79B	5.66	17.50%	14.63%	47.97%	17.22%
STWD	63 Neutral	$6.71B	17.26	5.34%	10.53%	-13.19%	-11.26%
NLY	59 Neutral	$16.52B	7.89	14.13%	12.40%	17.14%	―
BXMT	55 Neutral	$3.29B	30.44	3.01%	9.32%	-18.22%	―
RITM	55 Neutral	$5.89B	10.21	8.40%	8.95%	-1.07%	47.50%

Annaly Capital Corporate Events

Annaly Capital Reports Strong Q4 2025 Financial Performance

On January 28, 2026, Annaly Capital Management posted its financial supplement for the quarter ended December 31, 2025, showing a strengthened balance sheet and improved profitability metrics versus the prior quarter. GAAP net income per common share rose to $1.40 from $1.21, while earnings available for distribution per share held essentially steady at $0.74, and book value per common share increased to $20.21 from $19.25, reflecting solid returns on equity and disciplined leverage. The company continued to expand its investment portfolio to $132.1 billion, driven mainly by growth in agency mortgage-backed securities, residential mortgage loans and mortgage servicing rights, while maintaining relatively stable leverage and operating efficiency, signaling sustained scale in its core mortgage-focused strategies and a stable capital position for shareholders and creditors.

The most recent analyst rating on (NLY) stock is a Buy with a $25.00 price target. To see the full list of analyst forecasts on Annaly Capital stock, see the NLY Stock Forecast page.

Annaly Capital Highlights Strong Q4 2025 Results and Positioning

In its fourth-quarter 2025 investor presentation dated January 28, 2026, Annaly Capital Management reported a strong year, delivering a 20.2% economic return for 2025 and an 8.6% economic return in the fourth quarter, with quarterly earnings available for distribution of $0.74 per common share comfortably covering a declared dividend of $0.70 and supporting a year-end book value of $20.21 per share. The company highlighted conservative leverage of 5.6x, ample liquidity with $9.4 billion of assets available for financing, and continued scale in its housing finance platform, including a $104.7 billion total portfolio dominated by $92.9 billion in agency MBS, record 2025 activity in its residential credit correspondent channel and securitizations, growth in both residential credit and MSR portfolios, and $2.9 billion of accretive capital raised, underscoring its strengthened funding position and competitive standing as a leading non-bank issuer of prime jumbo and expanded credit mortgage-backed securities.

The most recent analyst rating on (NLY) stock is a Buy with a $25.00 price target. To see the full list of analyst forecasts on Annaly Capital stock, see the NLY Stock Forecast page.

Annaly Capital Announces Retirement of Senior Legal Executive

On December 29, 2025, Annaly Capital Management announced that long-serving executive Anthony C. Green will retire after 16 years with the company, transitioning from his roles as Chief Legal Officer, Chief Corporate Officer and Secretary to a Senior Advisor effective January 1, 2026 through March 31, 2026. Green, who has played a central role in overseeing legal and compliance functions, corporate responsibility, government relations and key control areas, and who was instrumental in Annaly’s 2020 shift to an internally managed structure and its execution of complex transactions, will receive continued base salary during his advisory term, remain eligible for 2025 incentive compensation, continue to vest in outstanding equity awards with certain modified retirement conditions, and receive additional lump-sum cash payments in connection with his retirement and related transition covenants, underscoring a structured leadership handover designed to preserve governance continuity and support the company’s strategic and operational stability.

The most recent analyst rating on (NLY) stock is a Buy with a $23.50 price target. To see the full list of analyst forecasts on Annaly Capital stock, see the NLY Stock Forecast page.

Annaly Capital Launches $2.5 Billion At-The-Market Program

On December 22, 2025, Annaly Capital Management, Inc. entered into distribution agency agreements with a group of major investment banks and broker-dealers, allowing the company to offer and sell up to $2.5 billion of its common stock from time to time through at-the-market equity offerings. Under these agreements, the sales agents will use commercially reasonable efforts to place Annaly’s shares in the market for a commission of up to 1% of gross sales proceeds, providing the company with a flexible mechanism to raise additional equity capital over time under its existing shelf registration, which could impact its capital structure and funding capacity.

The most recent analyst rating on (NLY) stock is a Buy with a $23.50 price target. To see the full list of analyst forecasts on Annaly Capital stock, see the NLY Stock Forecast page.