Annaly Capital Management, Inc. Announces Preferred Dividends
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Insights
The declaration of dividends for Annaly's Series F, G and I Preferred Stock is a significant event for both the company and its preferred shareholders. The dividend rates, which are based on the CME Term SOFR plus a spread, indicate the company's cost of preferred equity capital. The increase in dividend rates for Series F and G, in particular, suggests a higher return for investors, which could be a response to market conditions or a strategic move to attract and retain investors. For Series I, the fixed rate provides stability in payouts.
From a financial perspective, the declared dividends could imply that Annaly is generating sufficient cash flow to meet its obligations to preferred shareholders, which is a positive sign of financial health. However, it is important to monitor the company's earnings reports and cash flow statements to ensure that these dividends are sustainable over the long term without compromising the company's growth prospects or financial stability.
Annaly's decision to declare dividends on its preferred stock could reflect broader market trends, such as interest rate movements and the general demand for income-generating investments. The reliance on the CME Term SOFR, a benchmark interest rate for dollar-denominated derivatives and loans, suggests Annaly's approach to dividend adjustments is in line with market interest rates. This could be seen as an attempt to align shareholder returns with market expectations.
Furthermore, the attractiveness of Annaly's preferred shares in the market may be influenced by these dividend declarations. Investors typically compare the yields of preferred stocks with other fixed-income securities and an increased dividend yield could make Annaly's preferred stock more competitive. This could potentially impact the stock's liquidity and market price, as investors seek to capitalize on the favorable dividend yields.
The adjustment of dividend rates based on the CME Term SOFR plus a spread indicates a direct correlation between Annaly's dividend policy and the prevailing economic environment. As interest rates fluctuate, the cost of capital and the expected returns on investments also change. In a rising interest rate environment, Annaly's decision to increase dividend payouts may be a strategic move to maintain the desirability of its preferred stock.
However, an economist would also consider the potential impact of such dividend declarations on the company's long-term debt and equity financing strategies. If the dividend rates are too high relative to the company's earnings, it could lead to a reallocation of funds from other productive uses, potentially hindering growth. Conversely, if managed well, these dividends could signal strong financial management and a commitment to delivering shareholder value, which may positively influence investor confidence and the company's reputation in the financial markets.
In accordance with the terms of Annaly’s
In accordance with the terms of Annaly’s
Dividends for the Series F Preferred Stock, Series G Preferred Stock, and Series I Preferred Stock are payable on March 28, 2024 to preferred shareholders of record as of March 1, 2024.
About Annaly
Annaly is a leading diversified capital manager with investment strategies across mortgage finance. Annaly’s principal business objective is to generate net income for distribution to its stockholders and to optimize its returns through prudent management of its diversified investment strategies. Annaly is internally managed and has elected to be taxed as a real estate investment trust, or REIT, for federal income tax purposes. Additional information on the company can be found at www.annaly.com.
Forward-Looking Statements
This news release and our public documents to which we refer contain or incorporate by reference certain forward-looking statements which are based on various assumptions (some of which are beyond our control) and may be identified by reference to a future period or periods or by the use of forward-looking terminology, such as “may,” “will,” “should,” “estimate,” “project,” “believe,” “expect,” “anticipate,” “continue,” or similar terms or variations on those terms or the negative of those terms. Actual results could differ materially from those set forth in forward-looking statements due to a variety of factors, including, but not limited to, changes in interest rates; changes in the yield curve; changes in prepayment rates; the availability of mortgage-backed securities and other securities for purchase; the availability of financing and, if available, the terms of any financing; changes in the market value of our assets; changes in business conditions and the general economy; our ability to grow our residential credit business; our ability to grow our mortgage servicing rights business; credit risks related to our investments in credit risk transfer securities and residential mortgage-backed securities and related residential mortgage credit assets; risks related to investments in mortgage servicing rights; the our ability to consummate any contemplated investment opportunities; changes in government regulations or policy affecting our business; our ability to maintain our qualification as a REIT for
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Annaly Capital Management, Inc.
Investor Relations
1-888-8Annaly
investor@annaly.com
Source: Annaly Capital Management, Inc.
FAQ
What is the dividend rate for Annaly's Series F Preferred Stock for the first quarter of 2024?
When are the dividends for Annaly's Series F, G, and I Preferred Stocks payable?
What is the dividend rate for Annaly's Series G Preferred Stock for the first quarter of 2024?
What is the dividend rate for Annaly's Series I Preferred Stock for the first quarter of 2024?
