AGNC: The Pullback Is Getting Interesting With Yields At 14%

2026-03-22 08:30:00 ET

AGNC Investment Corp. ( AGNC ) got back to its prepandemic levels in May of 2021 only to retrace by almost -50% by the end of 2024. As the macroeconomic environment became more favorable and the Fed found itself in a position to continue cutting rates in the back half of 2025 AGNC was able to rebound back over $10 while producing double-digit yields. The rebound continued into February as shares exceeded $12, the geopolitical conflict in Iran started, oil skyrocketed, inflation came back on the radar, and future rate cuts have come into question. AGNC is now down -7.56% YTD as shares have fallen below the $10 level, pushing the dividend yield to 13.99%. The market is starting to reprice risk, and AGNC’s rebound that was supported by tightening agency MBS spreads, a supportive yield curve, and strong demand from both the GSEs and commercial banks is not nearly as appealing as it once was. While AGNC is still one of the largest pure play agency MBS mortgage REITs with an investment portfolio that exceeds $90 billion, the current macroeconomic environment is casting a lot of doubt on its future prospects. AGNC’s operating environment in the short-term presents some challenges, especially after the Fed released their updated summary of economic projections after the FOMC meeting, but I am still bullish from an income perspective. The reality is that we have been here before, and we’re likely to be here again at some point in the future. AGNC has paid a monthly dividend of $0.12 since April 2020 and I am looking at the declining share price as an opportunity to lock in a higher yield on cost....

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