“I would say, on a go-forward return basis at today's valuation levels, mortgages versus swaps ... returns are somewhere between 19% and 20% or 22%.”
— Peter Federico
03Detailed Report
AGNCO
Company AGNCO
Period
Q1 2025
CurrencyUSD
Report TypeQuarterly Earnings
GeneratedMay 20, 2026
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Executive Summary
AGNC’s QQ1 2025 results unfold against a backdrop of elevated macro volatility and mortgage market dislocation. The company delivered an economic return of 2.4% for the quarter and a total stock return with dividends reinvested of 7.8%, underscoring the appeal of Agency MBS as a fixed-income surrogate in a turbulent macro environment. Despite material spread widening that temporarily depressed equity book value, AGNC maintained strong liquidity and executed opportunistic capital deployment through its ATM program, raising $509 million of common equity with a premium to tangible net book value. End-quarter leverage stood at 7.5x tangible equity (average 7.3x), and the balance sheet remained robust with about $6 billion of cash and unencumbered Agency MBS, representing roughly 63% of tangible equity.
Key Performance Indicators
Revenue
Decreasing
78.00M
QoQ: -49.35% | YoY: -95.26%
Gross Profit
Decreasing
78.00M
1.00% margin
QoQ: -49.35% | YoY: -95.19%
Operating Income
Decreasing
748.00M
QoQ: -14.12% | YoY: -34.96%
Net Income
Decreasing
50.00M
QoQ: -59.02% | YoY: -88.71%
EPS
Decreasing
0.02
QoQ: -83.26% | YoY: -97.24%
Revenue Trend
Margin Analysis
Financial Highlights
Revenue: $78.0 million (YoY -95.3%, QoQ -49.3%) | Gross Profit: $78.0 million (YoY -95.2%, QoQ -49.3%) | Operating Income: $748.0 million (YoY -34.96%, QoQ -14.12%) | Net Income: $50.0 million (YoY -88.71%, QoQ -59.02%) | EPS: $0.0163 (YoY -97.24%, QoQ -83.26%) | Net Spread and Dollar Roll Income: $0.44 per share | Net Interest Rate Spread: 2.12% | Weighted Avg Coupon: ~5.0% | CPR (Actual): 7.0% (Q1); Projected Life CPR: 8.3% (end of quarter)
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
78.00M
-95.26%
-49.35%
Gross Profit
78.00M
-95.19%
-49.35%
Operating Income
748.00M
-34.96%
-14.12%
Net Income
50.00M
-88.71%
-59.02%
EPS
0.02
-97.24%
-83.26%
Key Financial Ratios
Gross Profit Margin
Weak
1.00%
Gross profit margin is below industry norms, profitability concerns
Operating Profit Margin
Weak
-0.60%
Operating margin is below industry norms, profitability concerns
Net Profit Margin
Excellent
64.10%
Net profit margin is exceptional, indicating strong pricing power and operational efficiency
Return on Assets
Weak
0.05%
Return on assets suggests inefficient capital allocation
Return on Equity
Weak
0.50%
Return on equity suggests inefficient capital allocation
Current Ratio
Concern
0.24
Current ratio below safe levels, potential liquidity risk
Debt to Equity
High Risk
8.30
Debt-to-equity indicates high leverage and elevated financial risk
P/E Ratio
High Growth
43.99x
Very high P/E indicates aggressive growth expectations, higher risk
Price to Book
Undervalued
0.88x
Trading below book value, potential value opportunity or distressed
Management Insights Available for Members
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