Core Insights - AGNC Investment and Ares Capital offer significantly high dividend yields, with AGNC at over 12.5% monthly and Ares at 9.6% quarterly, both substantially above the S&P 500 yield of around 1.1% [1] AGNC Investment - AGNC Investment is a mortgage REIT that invests in Agency MBS, which are low-risk fixed-income investments backed by government agencies [2] - The company employs a leverage ratio of 7.2 times to enhance returns, which can be lucrative as long as returns exceed the cost of capital [2][3] - AGNC has maintained its monthly dividend since 2020, with an average annualized total return of 11.8% since its IPO in 2008, primarily driven by dividends [3][4] Ares Capital - Ares Capital is the largest BDC, focusing on direct loans to middle-market companies with annual revenues between $100 million and $1 billion [5] - The company’s portfolio had a weighted-average yield of 9.3% at the end of 2025, indicating higher returns compared to Agency MBS [5] - Ares Capital maintains a modest debt-to-equity ratio of 1.08, ensuring a strong balance sheet and ample liquidity for portfolio expansion [6]

Core Viewpoint - AGNC Investment Corp. has declared a cash dividend of $0.12 per share for February 2026, payable on March 10, 2026, to stockholders of record as of February 27, 2026 [1]. Company Overview - AGNC Investment Corp. is a leading investor in Agency residential mortgage-backed securities (Agency MBS), benefiting from guarantees against credit losses by Fannie Mae, Freddie Mac, or Ginnie Mae [1]. - The company employs a leveraged investment strategy, primarily financing its Agency MBS assets through repurchase agreements, and utilizes dynamic risk management strategies to protect portfolio value from interest rate and market risks [1]. - Since its inception in 2008, AGNC has paid over $15 billion in common stock dividends, demonstrating a track record of providing favorable long-term returns through substantial monthly dividend income [1]. Market Position - AGNC serves as a significant source of private capital for the U.S. residential housing market, with a team experienced in managing mortgage assets across various market cycles [1].

Core Insights - The webinar discusses high dividend investment opportunities, focusing on two specific picks that are currently favorable in the market [2][4]. Company Overview - High Dividend Opportunities (HDO) is celebrating its 10-year anniversary with Seeking Alpha, having grown to be the largest dividend service on the platform [4][5]. - Will Barton, a key figure at HDO, has been part of the service for seven years and emphasizes the importance of cash flow from investments [4][5]. Investment Strategy - HDO employs an income method that focuses on generating cash flow from a diversified portfolio of at least 42 income-producing stocks, aiming for consistent income growth regardless of market conditions [10][11]. - The strategy emphasizes the importance of not relying solely on capital gains, instead prioritizing cash flow to meet ongoing financial obligations [9][12]. Market Conditions - Current market conditions are favorable for dividend investing, with high interest rates leading to lower prices for dividend-paying stocks, creating buying opportunities [19][20]. - The average yield targeted by HDO is over 9%, with the portfolio yielding over 10% for the past year and a half due to favorable interest rate dynamics [18][19]. Specific Investment Picks - The first investment pick discussed is Annaly Capital Management (NLY), which has a long history in the mortgage-backed securities (MBS) sector and is currently positioned to benefit from high coupon mortgages [29][30]. - The second pick is AGNC Investment Corp., which operates similarly to NLY and has been able to issue equity at favorable prices, allowing for portfolio expansion [45][47]. Economic Outlook - The company believes that interest rates will eventually decline, leading to a favorable environment for dividend-paying stocks as lower rates typically increase their attractiveness [53][60]. - Long-term demographic trends and technological advancements are expected to contribute to lower inflation and, consequently, lower interest rates, which would benefit the business models of companies like NLY and AGNC [56][59].

Core Viewpoint - The S&P 500's dividend yield is currently around 1.1%, near an all-time low, driven by rising stock prices and a reduced focus on dividends by many companies. However, there are notable exceptions with high dividend yields, including three significant stocks offering yields up to 12.5% [1]. Group 1: AGNC Investment - AGNC Investment leads with a 12.5% dividend yield, paying dividends monthly, which enhances its appeal for passive income [4]. - The company invests in Agency MBS, a $9.2 trillion market, leveraging these fixed-income assets to boost returns [5]. - Current strong market conditions for Agency MBS, along with falling interest rates, suggest AGNC can maintain its high monthly dividend [6]. Group 2: Ares Capital - Ares Capital has a 10% dividend yield, providing direct loans to middle-market companies, which generates interest income to support its dividend [7]. - The company has maintained or increased its dividend for over 16 consecutive years, with core earnings exceeding dividend payments, providing a cushion for potential earnings dips [8]. - Ares Capital's strong financial profile and record level of new investments position it well for continued dividend support [9]. Group 3: Western Midstream Partners - Western Midstream Partners currently yields 8.9%, operating a portfolio of energy midstream assets, including pipelines and processing plants [11]. - The majority of its assets generate stable cash flow through long-term, fixed-fee contracts, contributing to its dividend sustainability [11].

Core Insights - Agency mortgage REITs have experienced significant gains in 2025, with Dynex Capital (DX) and AGNC Investment (AGNC) reporting substantial comprehensive income and book value growth, indicating a favorable macroeconomic environment [1][2] - Despite these gains, there is caution regarding the sustainability of such performance, as the sharp increases are viewed as one-time events, and both companies may be slightly overvalued [2][18] - The outlook for 2026 remains strong, driven by anticipated continued tightening of spreads and favorable macro developments [11][13] Macro Factors - The spread between residential mortgage-backed securities (RMBS) and treasuries was notably wide in 2024 at 225 basis points, but narrowed to 150 basis points in 2025, positively impacting book values of mREITs [4][7] - The narrowing spread in 2025 led to widespread book value gains across the sector, with DX and AGNC showing strong rebounds [7][9] - Anticipated factors for 2026 include GSE purchases of MBS, the end of quantitative tightening (QT), and continued bond fund inflows, which are expected to support further tightening of spreads [11][12] Financial Performance - In Q4 2025, DX reported a book value increase of $0.78 per share, while AGNC achieved a 22.7% economic return, resulting in a book value rise of $0.47 per share [9][25] - AGNC's comprehensive income for 2025 was $1.22 per share, with significant unrealized gains contributing to this figure [8][19] - DX's net income included $370 million from unrealized gains, highlighting the reliance on such gains for sustaining dividends [20][29] Dividend Sustainability - Both AGNC and DX's dividends are primarily supported by unrealized gains rather than recurring earnings, raising concerns about their sustainability [26][27] - AGNC paid $1.44 in dividends per share in 2025, which was not fully covered by its net interest income of $675 million, indicating potential future dividend cuts [26][30] - The payout ratios for both companies suggest that without unrealized gains, their book values could be adversely affected [29][30] Investment Alternatives - Preferred shares of mREITs are viewed as having higher total return prospects compared to common shares, as they sit above common equity in the capital structure [31][46] - Preferreds from AGNC and Dynex are currently trading at or near par, offering attractive yields without significant risk of redemption [34][36] - Other mREITs, such as Armour Residential, have preferreds trading at discounts to par, presenting potential capital gains opportunities [38][40]

Group 1 - Rida Morwa is a former investment and commercial banker with over 35 years of experience, advising clients on high-yield investment strategies since 1991 [1] - The Investing Group High Dividend Opportunities focuses on sustainable income through high-yield investments with a targeted safe yield of over 9% [1] - The service includes features such as a model portfolio with buy/sell alerts, preferred and baby bond portfolios for conservative investors, and regular market updates [1] Group 2 - The article emphasizes the importance of community and education in investing, advocating that no one should invest alone [1] - The service closely monitors all positions and issues buy and sell alerts exclusively for its members [3]

Core Viewpoint - AGNC Investment Corp. is recognized as one of the best monthly dividend stocks to consider for investment, with a positive outlook supported by recent developments in interest rates and economic returns [1][7]. Financial Performance - In Q4, AGNC reported a core EPS of $0.35, which was below the estimated $0.38 and the consensus of $0.37. However, the company ended the year with a strong economic return of 22.7%, with a total stock return of 34.8% when dividends were reinvested, nearly double the S&P 500's return [2][3]. Market Conditions - The investment environment is described as supportive due to the Federal Reserve's shift towards a more accommodative policy stance, which is expected to stabilize mortgage spreads and enhance AGNC's ability to generate compelling risk-adjusted returns [4]. Strategic Positioning - AGNC is positioned to benefit from anticipated rate cuts, which are expected to support net spread and dollar roll income, thereby enhancing its book value and overall financial health [2][4]. Company Overview - AGNC Investment Corp. operates as an internally managed REIT, focusing on providing private capital to the U.S. housing market and enhancing liquidity in residential mortgage markets, which supports housing finance and homeownership [4].

Core Insights - The mortgage REIT sector experienced significant declines, primarily driven by the poor performance of PennyMac Financial Services (PFSI), which saw a 33% drop in stock price, impacting the entire sector [19][21][27] - The declines were exacerbated by hotter-than-expected CPI/PPI data and the reporting of compressed gain-on-sale/loan margins and larger mortgage servicing rights (MSR) amortization by PMT and PFSI [20][27] - The valuation of PFSI was deemed excessively high prior to earnings, trading at an 80% premium to its current book value, which raised concerns about its sustainability [23][26] Mortgage REITs and BDCs Performance - A table of mortgage REITs and BDCs showed substantial declines in share prices, with notable drops including Two Harbors (TWO) down 13.69% and PennyMac (PMT) down 12.44% [16][17] - The overall sentiment in the mortgage REIT sector was negative, with many companies experiencing declines regardless of their individual fundamentals [20][27] Preferred Shares and Baby Bonds - The company has been shifting its portfolio towards preferred shares and baby bonds, which have historically provided strong performance on a risk-adjusted basis and have outperformed other sectors [28]

Core Viewpoint - AGNC Investment Corp. is identified as one of the most undervalued REIT stocks currently available for investment, with a price target raised to $11 by Piper Sandler, reflecting positive expectations regarding agency MBS spreads and tangible book values [1]. Financial Updates - AGNC announced a cash dividend of $0.12 per share for January 2026 and reinstated Dr. Morris Davis as an independent director on the Compensation and Corporate Governance Committee [2]. Management Expertise - The return of Dr. Morris Davis, who previously served as Chief Housing Economist on the Council of Economic Advisors, is expected to enhance AGNC's administration with his expertise in housing and macroeconomic policy [3]. Company Operations - AGNC operates as a real estate investment trust, focusing on investments in residential mortgage pass-through securities and collateralized mortgage obligations, as well as other mortgage-related securities [4].

Group 1 - Top Wall Street analysts have revised their outlook on several key stocks, indicating a shift in market sentiment [1] - The article suggests that investors consider buying CALC stock based on analysts' recommendations [1]