AGNC Investment Reports Increase in Book Value. Can a Dividend Hike Be Coming?
The past year has been difficult for the financial sector, as banks and real estate investment trusts (REITs) underperformed as a result of efforts to combat the coronavirus epidemic. The mortgage REIT space was hit particularly hard, and many companies operating in that sector had very difficult headwinds to overcome. As markets settled down during the summer, these mortgage REITs eventually recovered some (or all) of their prior valuations.
For AGNC Investment (NASDAQ: AGNC), the recovery in book value is almost complete. Is it time for the company to reevaluate the current (reduced) dividend payout rate?
Mortgage REITs are a slightly different animal than the typical REIT. Most REITs follow a landlord-tenant model, where the company develops real estate assets and then rents them out. A typical example might be Realty Income (NYSE: O), which rents out stand-alone properties to tenants like drug stores, convenience stores, or dollar stores.
Source Fool.com
