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Why Is Annaly (NLY) Up 3.5% Since Last Earnings Report?

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A month has gone by since the last earnings report for Annaly Capital Management (NLY - Free Report) . Shares have added about 3.5% in that time frame, outperforming the S&P 500.

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

Annaly Q3 Earnings Surpass Estimates, Book Value Declines Y/Y

Annaly reported third-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 66 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 $275.8 million in the reported quarter, which missed the Zacks Consensus Estimate by 38.3%. In the prior-year quarter, the company reported a NII of $13.4 million.

At the end of the third quarter, Annaly had $125.9 billion of total assets, rising 12.2% from the prior quarter.

In the reported quarter, the average yield on interest-earning assets (excluding premium amortization adjustment or PAA) was 5.40%, up from the prior-year quarter’s 5.16%. The average economic costs of interest-bearing liabilities were 3.96%, up from 3.93% in the year-ago quarter.

Net interest spread (excluding PAA) of 1.50% in the third quarter increased from 1.32% in the prior-year quarter. Also, the net interest margin (excluding PAA) was 1.70% compared with 1.52% in the third quarter of 2024.

Annaly’s BVPS was $19.25 as of Sept. 30, 2025, down from $19.54 in the prior-year quarter. At the end of the reported quarter, the company’s economic capital ratio was 14.8%, up from 14.6% in the prior-year quarter.

In the third quarter, the weighted average actual constant prepayment rate was 8.6%, up from 7.6% in the year-ago quarter.

Economic leverage was 5.7X as of Sept. 30, 2025, unchanged from the year-ago quarter. 

Annaly generated an annualized EAD return on average equity of 14.7% in the third quarter, which increased from the prior-year quarter’s 12.9%.

How Have Estimates Been Moving Since Then?

It turns out, estimates review have trended downward during the past month.

VGM Scores

Currently, Annaly has a poor Growth Score of F, however its Momentum Score is doing a bit better with a D. Following the exact same course, the stock has a grade of D on the value side, putting it in the bottom 40% for value investors.

Overall, the stock has an aggregate VGM Score of F. 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 these revisions 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.


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