AGNC Investment (NASDAQ:AGNC) Corp. announced an expansion of its common stock offering program, now allowing for sales up to $1.5 billion. The real estate investment trust, listed on the Nasdaq Global Select Market under the ticker NASDAQ:AGNC, filed the update with the Securities and Exchange Commission (SEC) today.
As outlined in the SEC filing, AGNC entered into amendments with several financial institutions to increase the aggregate offering price of its common stock. The company may issue and sell shares through an "at the market" program, which does not obligate it to sell any specific number of shares.
The recent amendments, dated October 25, 2024, follow the initial sales agreements from October 12, 2023, and an earlier amendment from May 9, 2024. Since the first amendment, AGNC has sold approximately $1.25 billion worth of common stock. The new amendments could see AGNC sell up to an additional $1.5 billion in shares.
Sales under these agreements may occur through various transactions on the Nasdaq Global Select Market or other trading venues, in over-the-counter transactions, or in privately negotiated deals, including block trades. Each financial institution involved will sell shares on a best-efforts basis and may earn up to 1.0% of the gross sales price as compensation.
The offering is part of a shelf registration statement filed on May 9, 2024, including a prospectus and a prospectus supplement dated October 25, 2024. The offering will terminate once all shares are sold or upon the termination of the sales agreements, which can be initiated by either the agents or AGNC with a 10-day notice.
The filing also included an opinion from Skadden, Arps, Slate, Meagher & Flom LLP concerning the legal aspects of the share sales, which is incorporated by reference into the registration statement.
In other recent news, AGNC Investment Corp has reported robust Q3 returns, with a notable economic return of 9.3% and a stable monthly dividend. The company saw a favorable investment environment due to the Federal Reserve's rate cut in September, which led to an increase in AGNC's net asset value per common share by 1.4% year-to-date. Furthermore, the total stock return with reinvested dividends reached an impressive 17.5%. AGNC has maintained a monthly dividend of $0.12 per common share for 55 months and reported total comprehensive income of $0.63 per share for Q3.
Despite a slight decrease in the Non-Agency securities portfolio to $890 million and a 3.5% decrease in book value due to rising treasury rates, the company's investment portfolio expanded to $72.1 billion. These are among the recent developments that reflect AGNC's strategic shift towards treasury-based hedges and a focus on lower coupon Agency MBS.
InvestingPro Insights
AGNC Investment Corp.'s recent expansion of its common stock offering program aligns with several key financial indicators and trends highlighted by InvestingPro. The company's strong dividend performance is particularly noteworthy, with InvestingPro Tips revealing that AGNC "pays a significant dividend to shareholders" and "has maintained dividend payments for 17 consecutive years." This consistent dividend policy may be attractive to investors considering the expanded stock offering.
The company's financial health is further underscored by its profitability. InvestingPro Data shows a P/E Ratio of 7.14, suggesting the stock may be undervalued relative to earnings. Additionally, AGNC's revenue growth is impressive, with a 226.17% increase over the last twelve months as of Q3 2024. This growth trajectory supports the InvestingPro Tip that "net income is expected to grow this year."
For investors seeking more comprehensive analysis, InvestingPro offers 8 additional tips for AGNC Investment Corp., providing a deeper understanding of the company's financial position and market outlook.
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