Annaly stock price forms 2 bullish patterns ahead of earnings

April 23, 2024 05:39 AM PDT | By Invezz
 Annaly stock price forms 2 bullish patterns ahead of earnings
Image source: Invezz

Annaly Capital (NYSE: NLY) stock price has erased all gains made earlier this year as hopes of a Fed rate cut fall and as mortgage rates rise. It rallied from a low of $17.68 after its fourth-quarter earnings and jumped to over $19.73 in March. It has now erased most of those gains and has fallen by over 7.22% from its highest level this year.

Annaly Capital Management earnings ahead

Annaly Capital’s shares have dropped by over 5% this year but they remain above 34% from their lowest level in 2023. It has become one of the best-performing REITs in the industry. Still, as an investment, the company has continued to underperform the likes of S&P 500 and Nasdaq 100 indices.

The next important news to watch will be the upcoming Annaly Capital’s financial results scheduled for Wednesday. Analysts expect the figures to show that the company’s results to show that its revenues rose to $157 million in the fourth quarter. 

The most recent financial results showed that Annaly’s total portfolio rose to over $74.3 billion. Most of these funds were in its highly liquid agency portfolio. The residential credit portfolio rose by about 9% to $5.7 billion. 

For starters, Annaly Capital is one of the biggest REITs in the financial results. The company operates three key businesses: agency group, residential credit, and mortgage servicing rights group.

Its agency group, the biggest part of the company, invests in mortgage-backed securities (MBS) by residential mortgages that are guaranteed by Fannie Mae, Freddie Mac, or Ginnie Mae. It has over $65.7 billion in assets.

The residential credit group has over $5.7 billion in assets and invests in non-agency residential mortgage assets. Finally, the mortgage servicing rights invest in assets that provide the right to service residential loans in exchange for a portion of interest payments.

Annaly Capital is one of the highest-yielding companies in Wall Street. It has a forward dividend yield of about 14.18%. Despite this yield, the company has constantly underperformed the broader market.

Annaly’s total returns in the past five years stood at minus 14.3% compared to the S&P 500’s 70%. The same trend is happening this year as the stock has dropped by over 2% while the S&P 500 has jumped by over 5%.

Annaly Capital stock price forecast

Annaly stock

NLY chart by TradingView

The daily chart shows that the NLY share price has dropped sharply in the past few weeks. It moved from a high of $19.80 to a low of $17.68. A closer look shows that the stock has moved below the 50-day and 100-day Exponential Moving Averages (EMA).

A closer look shows that the stock has formed a double-bottom pattern at $17.68 whose neckline is at $19.71. In most periods, this pattern is one of the most popular bullish signs. At the same time, the stock has formed an inverse head and shoulders pattern. 

Therefore, from a technical perspective, there is a likelihood that the stock will rebound after earnings. If this happens, the key level to watch will be at $19. 

However, be on the lookout for the key support at $17.68. A break below that support will point to more downside in the near term. If this happens, the next point to watch will be at $17.

The post Annaly stock price forms 2 bullish patterns ahead of earnings appeared first on Invezz


Disclaimer

The content, including but not limited to any articles, news, quotes, information, data, text, reports, ratings, opinions, images, photos, graphics, graphs, charts, animations, and video (Content) is a service of Kalkine Media LLC., having Delaware File No. 4697309 (“Kalkine Media, we or us”) and is available for personal and non-commercial use only. The principal purpose of the Content is to educate and inform. The Content does not contain or imply any recommendation or opinion intended to influence your financial decisions and must not be relied upon by you as such. Some of the Content on this website may be sponsored/non-sponsored, as applicable, but is NOT a solicitation or recommendation to buy, sell or hold the stocks of the company(s) or engage in any investment activity under discussion. Kalkine Media is neither licensed nor qualified to provide investment advice through this platform. Users should make their own enquiries about any investments and Kalkine Media strongly suggests the users to seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice), as necessary. Kalkine Media hereby disclaims any and all the liabilities to any user for any direct, indirect, implied, punitive, special, incidental or other consequential damages arising from any use of the Content on this website, which is provided without warranties. The views expressed in the Content by the guests, if any, are their own and do not necessarily represent the views or opinions of Kalkine Media.
The content published on Kalkine Media also includes feeds sourced from third-party providers. Kalkine does not assert any ownership rights over the content provided by these third-party sources. The inclusion of such feeds on the Website is for informational purposes only. Kalkine does not guarantee the accuracy, completeness, or reliability of the content obtained from third-party feeds. Furthermore, Kalkine Media shall not be held liable for any errors, omissions, or inaccuracies in the content obtained from third-party feeds, nor for any damages or losses arising from the use of such content. Some of the images/music that may be used on this website are copyrighted to their respective owner(s). Kalkine Media does not claim ownership of any of the pictures/music displayed/used on this website unless stated otherwise. The images/music that may be used on this website are taken from various sources on the internet, including paid subscriptions or are believed to be in public domain. We have used reasonable efforts to accredit the source (public domain/CC0 status) to where it was found and indicated it, as necessary.
This disclaimer is subject to change without notice. Users are advised to review this disclaimer periodically for any updates or modifications.


Sponsored Articles


Investing Ideas

Previous Next