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Annaly Shares Gain as It Increases Quarterly Dividend by 7.7%

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Annaly Capital Management, Inc. (NLY - Free Report) rose 2.4% during Friday’s trading session as it announced a cash dividend of 70 cents per share for the first quarter of 2025, marking a 7.7% hike from the preceding payout. This dividend will be paid out on April 30, 2025, to shareholders of record as of March 31.

The company slashed its dividend by 26% to 65 cents in March 2023. Currently, NLY’s payout ratio is 96% of its earnings. Based on its closing price of $21.61 on Friday, Annaly has an annual dividend yield of 12.03% at present.

NLY’s Other Capital Distribution Activities

On Dec. 31, 2024, the company’s board of directors authorized a common share repurchase program, which will expire on Dec. 31, 2029. Under the program, the company may repurchase up to $1.5 billion of its outstanding shares of common stock. However, the company has not repurchased shares under this plan since it was announced.

Annaly is focusing on improving its liquidity and reducing leverage. Till the end of the fourth quarter of 2024, the company enjoyed a strong liquidity position. NLY had an unencumbered asset portfolio, aggregating $5.8 billion, which can readily provide liquidity in times of adverse market conditions.

Thus, decent liquidity and a strong balance sheet position will likely enable sustainable capital distributions for NLY.

Price Performance & Zacks Rank of Annaly

In the past year, shares of the company have risen 26.7% compared with the industry’s 8.8% growth.

 

Zacks Investment ResearchImage Source: Zacks Investment Research

 

At present, Annaly carries a Zacks Rank #2 (Buy).  You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other Banks Taking Similar Steps

Last month, WaFd, Inc. (WAFD - Free Report) hiked its quarterly cash dividend by 3.8% to 27 cents per share. The dividend will be paid out on March 7, 2025, to its shareholders of record as of Feb. 21.

Before the recent hike, WAFD increased its dividend 4% to 26 cents per share in February 2024. WaFd has raised its dividend four times in the past five years, with a growth rate of 4.1%. It has a dividend payout ratio of 37%.

In January, Hancock Whitney Corp. (HWC - Free Report) hiked its quarterly cash dividend 12.5% to 45 cents per share. The dividend will be paid out on March 17, 2025, to its shareholders of record as of March 5.

Before the recent hike, the bank increased its dividend by 33.3% to 40 cents per share in April 2024. HWC has raised its dividend thrice in the past five years, with a growth rate of 7.5%. It has a dividend payout ratio of 30%.


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