Which Mortgage Investment Trust is the Better Buy: Annaly Capital or PennyMac Mortgage Trust?

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PENNYMAC ($NYSE:PMT) Mortgage Investment Trust (PMT) is one of the leading mortgage real estate investment trust (REIT) in the United States, offering a range of mortgage-backed securities and mortgage loans for investors. When it comes to investing in a mortgage investment trust, there are two main contenders: Annaly Capital Management and PennyMac Mortgage Trust. Annaly Capital Management is one of the largest publicly traded mortgage REITs in the U.S. with a portfolio focused on agency and non-agency residential mortgage-backed securities, commercial mortgage-backed securities, and other investments in mortgages. On the other hand, PennyMac Mortgage Trust has a portfolio that is mainly comprised of government-sponsored entities and government mortgage-backed securities. Both Annaly Capital Management and PennyMac Mortgage Trust are strong contenders for a potential investor looking for a good REIT to invest in.

Both companies have strong portfolios with reliable income streams and are well-positioned to benefit from the current low-interest rate environment. Annaly Capital Management is the larger of the two companies and has a longer track record of success, but PennyMac Mortgage Trust is the newer entrant to the market and has recently seen impressive growth. Ultimately, which company is a better buy will depend on an investor’s personal goals and risk appetite.

Share Price

When considering which Mortgage Investment Trust may be the better buy, Annaly Capital and PennyMac Mortgage Trust are two top contenders. On Monday, PennyMac Mortgage Trust stock opened at $12.8 and closed at $12.9, a 1.3% increase from the previous day’s closing price of $12.8. This suggests that PennyMac Mortgage Investment Trust may be the better bet, as it appears to have had a more stable performance throughout the year than its competitor. Live Quote…

About the Company

Income Snapshot

Below shows the total revenue, net income and net margin for PMT. More…

Cash Flow Snapshot

Below shows the cash from operations, investing and financing for PMT. More…

Balance Sheet Snapshot

Below shows the total assets, liabilities and book value per share for PMT. More…

Key Ratios Snapshot

Some of the financial key ratios for PMT are shown below. More…

Analysis

GoodWhale conducted an analysis of PENNYMAC MORTGAGE INVESTMENT TRUST’s wellbeing, and classified it as a ‘cow’ on our Star Chart. This is a type of company with a track record of paying out consistent and sustainable dividends. As such, PENNYMAC MORTGAGE INVESTMENT TRUST would be a good option for investors looking for a steady and reliable return. Our analysis revealed that PENNYMAC MORTGAGE INVESTMENT TRUST has a high health score of 7/10 with regard to its cashflows and debt, which means it is capable to safely ride out any crisis without the risk of bankruptcy. Furthermore, it scored strongly in asset, medium in profitability, and weak in dividend and growth. More…

Peers

The mortgage industry is highly competitive, with many companies vying for market share. PennyMac Mortgage Investment Trust is one of the leading players in the industry, and its competitors include Ellington Financial Inc, Invesco Mortgage Capital Inc, and Two Harbors Investment Corp. Each of these companies has a strong presence in the marketplace, and they are all fighting for a piece of the pie.

– Ellington Financial Inc ($NYSE:EFC)

Ellington Financial Inc. is a real estate investment trust that focuses on originating, acquiring, financing, and managing mortgage-related and mortgage-backed securities. The company has a market capitalization of $799.24 million as of March 2022. Ellington Financial Inc. is headquartered in Old Greenwich, Connecticut.

– Invesco Mortgage Capital Inc ($NYSE:IVR)

Invesco Mortgage Capital Inc. is a holding company, which engages in the provision of financing and investment management solutions to the mortgage market. It operates through the following segments: Agency; Consumer; and Commercial. The company was founded in 1986 and is headquartered in Atlanta, GA.

– Two Harbors Investment Corp ($NYSE:TWO)

Harbors Investment Corp is a real estate investment trust that primarily invests in residential mortgage-backed securities. The company has a market cap of 1.23 billion as of 2022. Harbors Investment Corp is headquartered in New York, NY.

Summary

PennyMac Mortgage Investment Trust (PMT) is a real estate investment trust (REIT) that invests mainly in residential mortgage-backed securities (RMBS) issued by U.S. government-sponsored entities (GSEs). It seeks to generate attractive risk-adjusted returns through active management of its investments. The company has a diversified portfolio that includes a variety of loan types and maturities, including fixed-rate, adjustable-rate, and jumbo loans. PMT also engages in loan origination and purchase activities. It also invests in other debt instruments related to the mortgage market such as mortgage servicing rights, lender-placed insurance and certain other financial assets.

The company has high liquidity and balance sheet strength which enables it to take advantage of opportunities in the market. PMT has a disciplined investment approach that includes thorough credit analysis and portfolio diversification. Furthermore, its management team has extensive experience in the mortgage market, providing it with an edge in the competitive landscape.