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Why This 1 Value Stock Could Be a Great Addition to Your Portfolio

·2 min read

Taking full advantage of the stock market and investing with confidence are common goals for new and old investors alike.

Achieving those goals is made easier with the Zacks Style Scores, a unique set of guidelines that rates stocks based on popular investing methodologies, namely value, growth, and momentum. The Style Scores can help you narrow down which stocks are better for your portfolio and which ones can beat the market over the long-term.

Why Investors Should Pay Attention to This Value Stock

Different than growth or momentum investors, value-focused investors are all about finding good stocks at good prices, and discovering which companies are trading under what their true value is before the broader market catches on. The Value Style Score utilizes ratios like P/E, PEG, Price/Sales, and Price/Cash Flow to help pick out the most attractive and discounted stocks.

Annaly Capital Management (NLY)

Annaly Capital Management, Inc. is a mortgage real estate investment trust (mREIT) that primarily owns, manages and finances a portfolio of real-estate-related investment securities. Its investment portfolio includes mortgage pass-through certificates, collateralized mortgage obligations (CMOs), credit risk transfer (CRT). The company’s investment may also comprise, other securities indicating interests in or obligations backed by pools of mortgage loans, residential mortgage loans, MSR and corporate debt.

NLY is a Zacks Rank #2 (Buy) stock, with a Value Style Score of A and VGM Score of B. Shares are currently trading at a forward P/E of 4.8X for the current fiscal year compared to the REIT and Equity Trust industry's P/E of 7.5X. Additionally, NLY has a PEG Ratio of 1 and a Price/Cash Flow ratio of 2.9X. Value investors should also note NLY's Price/Sales ratio of 3.9X.

Many value investors pay close attention to a company's earnings as well. For NLY, two analysts revised their earnings estimate upwards in the last 60 days, and the Zacks Consensus Estimate has increased $0.23 to $4.31 per share for 2022. Per share NLY boasts an average earnings surprise of 14.3%.

With strong valuation and earnings metrics, a good Zacks Rank, and top-tier Value and VGM Style Scores, investors should strongly think about adding NLY to their portfolios.


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Zacks Investment Research