The 1 Stock I'd Buy Before AGNC Investment Right Now

Core Viewpoint - AGNC (NASDAQ: AGNC) offers a high forward yield of 12.8%, but its earnings are declining, raising concerns about the sustainability of its dividend [1][2] Group 1: AGNC Overview - AGNC is a mortgage real estate investment trust (mREIT) that generates income by buying mortgages and mortgage-backed securities (MBS) [2] - The projected EPS for AGNC is $1.51, which covers its forward dividend rate of $1.44, indicating a potential for dividend sustainability [1] - AGNC's current trading discount is attributed to declining earnings, which may lead to challenges in maintaining its dividend if the payout ratio exceeds 100% [2][3] Group 2: Interest Rate Impact - AGNC's profitability relies on the Fed's short-term rates being lower than long-term rates; however, recent interest rate cuts have not effectively reduced MBS yields and borrowing costs [2] - The company has been forced to take out loans at higher rates to purchase lower-yielding MBS, creating an ongoing imbalance if the real estate market remains weak [2] Group 3: Comparison with Vici Properties - Vici Properties (NYSE: VICI) is presented as a more stable investment option compared to AGNC, as it operates as an equity REIT that owns physical properties and has a consistent occupancy rate [3][4] - Vici has maintained a 100% occupancy rate since its IPO in 2018 by locking tenants into long-term leases, which are indexed to the Consumer Price Index (CPI) [5] - Vici's business model allows it to raise rents in line with inflation, and it has successfully increased its dividend every year since its IPO, currently offering a forward yield of 6% [6]