It has been about a month since the last earnings report for Annaly Capital Management (NLY Quick QuoteNLY - Free Report) . Shares have lost about 0.1% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Annaly due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.

Annaly Q2 Earnings Surpass Estimates, Book Value Declines Y/Y

Annaly reported second-quarter 2025 adjusted earnings available for distribution per average share of 73 cents, which beat the Zacks Consensus Estimate of 72 cents. The figure increased from 68 cents in the year-ago quarter.

The company’s average yield on interest-earning assets improved in the reported quarter. However, the company recorded a year-over-year decline in book value per share.

Inside Annaly’s Headlines

Net interest income was $273.2 million in the reported quarter, which missed the Zacks Consensus Estimate by 33.5%. In the prior-year quarter, the company reported a NII of $53.6 million.

At the end of the second quarter, Annaly had $112.1 billion of total assets, rising 6.7% from the prior quarter.

In the reported quarter, the average yield on interest-earning assets (excluding premium amortization adjustment or PAA) was 5.42%, up from the prior-year quarter’s 5.17%. The average economic costs of interest-bearing liabilities were 3.94%, up from 3.90% in the year-ago quarter.

Net interest spread (excluding PAA) of 1.47% in the second quarter increased from 1.24% in the prior-year quarter. Also, the net interest margin (excluding PAA) was 1.71% compared with 1.24% in the second quarter of 2024.

Annaly’s BVPS was $18.45 as of June 30, 2025, down from $19.25 in the prior-year quarter. At the end of the reported quarter, the company’s economic capital ratio was 14.3%, down from 14.4% in the prior-year quarter.

In the second quarter, the weighted average actual constant prepayment rate was 8.7%, up from 7.4% in the year-ago quarter.

Economic leverage was 5.8X as of June 30, 2025, unchanged from the year-ago quarter. 

Annaly generated an annualized EAD return on average equity of 14.86% in the second quarter, which increased from the prior-year quarter’s 13.36%.

How Have Estimates Been Moving Since Then?

Since the earnings release, investors have witnessed a downward trend in estimates revision.

VGM Scores

At this time, Annaly has a average Growth Score of C, however its Momentum Score is doing a bit better with a B. Following the exact same course, the stock was allocated a score of B on the value side, putting it in the second quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, Annaly has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

Annaly is part of the Zacks REIT and Equity Trust industry. Over the past month, AGNC Investment (AGNC Quick QuoteAGNC - Free Report) , a stock from the same industry, has gained 0.2%. The company reported its results for the quarter ended June 2025 more than a month ago.

AGNC Investment reported revenues of $162 million in the last reported quarter, representing a year-over-year change of -5500%. EPS of $0.38 for the same period compares with $0.53 a year ago.

AGNC Investment is expected to post earnings of $0.38 per share for the current quarter, representing a year-over-year change of -11.6%. Over the last 30 days, the Zacks Consensus Estimate has changed +1.1%.

AGNC Investment has a Zacks Rank #4 (Sell) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of F.