Should You Consider Adding AGNC Investment Corp. (AGNC) to your Portfolio?
Appleseed Fund, an investment management company released its second quarter 2024 investor letter. A copy of the same can be downloaded here. The fund’s Investor Class generated an absolute return of 17.36% over the 6 months that ended March 31, 2024, compared to the Morningstar Global Small/Midcap Index’s 18.46% return. Appleseed Fund was positioned for an inflationary, slow-growth environment for most of the previous year. The cautious position of the Appleseed Fund prevented investment gains even while inflation levels have been lowering and the stock market has been raging since the end of 2022. In addition, Appleseed’s lack of exposure to Magnificent Seven limited returns. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Appleseed Fund highlighted stocks like AGNC Investment Corp. (NASDAQ:AGNC), in the second quarter 2024 investor letter. AGNC Investment Corp. (NASDAQ:AGNC) offers private capital to the housing market. The one-month return of AGNC Investment Corp. (NASDAQ:AGNC) was 0.73%, and its shares lost 3.22% of their value over the last 52 weeks. On July 8, 2024, AGNC Investment Corp. (NASDAQ:AGNC) stock closed at $9.68 per share with a market capitalization of $7.003 billion.
Appleseed Fund stated the following regarding AGNC Investment Corp. (NASDAQ:AGNC) in its Q2 2024 investor letter:
"Appleseed Fund added three new names to the portfolio in the past six months: Humana Inc. (HUM), AGNC Investment Corp. (NASDAQ:AGNC), and Cameco Corporation (CCJ). AGNC is an internally managed REIT focused on the agency RMBS sector. As the best of breed RMBS REIT, AGNC trades at a discount to tangible book value and offers a mid-teens dividend yield. With MBS spreads at a 3+ standard deviation from the mean, investors in AGNC will benefit from a normalization of mortgage credit spreads. While we wait for agency mortgage spreads to normalize, Appleseed Fund clips a ~1.3% dividend each month."
An accountant holding a calculator and paperwork, representing the complex financial regulations the company must manage.
AGNC Investment Corp. (NASDAQ:AGNC) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 19 hedge fund portfolios held AGNC Investment Corp. (NASDAQ:AGNC) at the end of the first quarter which was 14 in the previous quarter. AGNC Investment Corp. (NASDAQ:AGNC) produced a robust economic return of 5.7% in Q1 driven by a combination of attractive dividends and book value appreciation. While we acknowledge the potential of AGNC Investment Corp. (NASDAQ:AGNC) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
We discussed AGNC Investment Corp. (NASDAQ:AGNC) in another article and shared the list of monthly dividend stocks with over 5% yield. In addition, please check out our hedge fund investor letters Q2 2024 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.