Why Is Annaly (NLY) Up 3.5% Since Last Earnings Report?

Core Viewpoint - Annaly Capital Management reported third-quarter earnings that surpassed estimates, but experienced a decline in book value year-over-year, raising questions about future performance and market trends [2][5]. Financial Performance - Adjusted earnings available for distribution per average share were 73 cents, exceeding the Zacks Consensus Estimate of 72 cents and up from 66 cents in the same quarter last year [2]. - Net interest income (NII) was $275.8 million, which fell short of the Zacks Consensus Estimate by 38.3%, compared to $13.4 million in the prior-year quarter [3]. - The average yield on interest-earning assets improved to 5.40%, up from 5.16% in the previous year [4]. - The net interest spread increased to 1.50% from 1.32% year-over-year, while the net interest margin rose to 1.70% from 1.52% [4]. Asset and Capital Metrics - Total assets at the end of the third quarter were $125.9 billion, reflecting a 12.2% increase from the prior quarter [3]. - Book value per share (BVPS) decreased to $19.25 from $19.54 in the prior-year quarter [5]. - The economic capital ratio improved to 14.8%, up from 14.6% year-over-year [5]. - Economic leverage remained stable at 5.7X as of September 30, 2025 [5]. Returns and Estimates - The annualized return on average equity was 14.7%, an increase from 12.9% in the prior-year quarter [6]. - Estimates for the stock have been trending downward over the past month, indicating a potential shift in market sentiment [7][10]. Stock Performance and Outlook - Annaly has a poor Growth Score of F and a Momentum Score of D, with an aggregate VGM Score of F, placing it in the bottom 40% for value investors [8]. - The company holds a Zacks Rank 3 (Hold), suggesting an expectation of in-line returns in the coming months [10].