Fannie Mae (OTCMKTS:FNMA) Cut to “Neutral” at Mizuho

Fannie Mae (OTCMKTS:FNMA) was downgraded by stock analysts at Mizuho from an “outperform” rating to a “neutral” rating in a note issued to investors on Monday, MarketBeat.com reports. They presently have a $5.00 target price on the financial services provider’s stock. Mizuho’s price objective would indicate a potential upside of 44.09% from the company’s current price.

FNMA has been the topic of several other reports. Wedbush reissued a “neutral” rating and set a $8.00 price objective on shares of Fannie Mae in a research note on Thursday, July 30th. B. Riley Financial lowered their price objective on Fannie Mae from $8.00 to $7.00 and set a “neutral” rating for the company in a research note on Thursday, July 30th. Keefe, Bruyette & Woods dropped their target price on Fannie Mae from $6.25 to $3.50 and set an “underperform” rating for the company in a report on Monday, September 28th. Finally, BTIG Research downgraded Fannie Mae from a “buy” rating to a “neutral” rating in a research report on Tuesday, June 16th. Five research analysts have rated the stock with a Hold rating and one has assigned a Sell rating to the company. According to data from MarketBeat, Fannie Mae currently has an average rating of “Reduce” and a consensus price target of $8.70.

Fannie Mae Stock Down 14.2%

Fannie Mae stock opened at $3.47 on Monday. The company’s 50-day moving average price is $5.43 and its 200-day moving average price is $6.35. The company has a market cap of $4.02 billion, a PE ratio of 86.77 and a beta of 1.68. Fannie Mae has a twelve month low of $3.24 and a twelve month high of $12.87.

Fannie Mae (OTCMKTS:FNMA) last announced its quarterly earnings results on Wednesday, July 29th. The financial services provider reported $0.68 EPS for the quarter, beating analysts’ consensus estimates of $0.63 by $0.05. Fannie Mae had a net margin of 4.59% and a negative return on equity of 76.66%. The firm had revenue of $7.57 billion during the quarter, compared to the consensus estimate of $7.32 billion. As a group, sell-side analysts expect that Fannie Mae will post 2.63 earnings per share for the current fiscal year.

Institutional Trading of Fannie Mae

A hedge fund recently bought a new stake in Fannie Mae stock. Ratan Capital Management LP bought a new stake in shares of Fannie Mae (OTCMKTS:FNMA) in the second quarter, according to its most recent Form 13F filing with the Securities & Exchange Commission. The fund bought 79,000 shares of the financial services provider’s stock, valued at approximately $514,000. 0.02% of the stock is owned by institutional investors.

Key Fannie Mae News

Here are the key news stories impacting Fannie Mae this week:

• Positive Sentiment: Potential loan-sale activity could support Fannie Mae’s earnings and improve investor sentiment if it generates meaningful gains or reduces balance-sheet risk. Fannie Mae Stock May Trade At A Premium On Loan Sale News
• Neutral Sentiment: A proposed shift away from FICO toward a competing credit-scoring model could lower mortgage costs and expand access to credit, but critics warn that weaker underwriting standards could increase credit risk for Fannie Mae and Freddie Mac. A Credit-Score Shift at Fannie and Freddie Is Shaking Up the Mortgage Market
• Negative Sentiment: Mizuho downgraded FNMA from Strong Buy to Hold and reduced its price target, citing higher mortgage rates, delays surrounding a potential release from conservatorship, and other privatization obstacles. The firm also cut its view on Freddie Mac, signaling weaker near-term sector sentiment. Fannie Mae Cut to Hold at Mizuho Fannie Mae, Freddie Mac Stocks Sink on Fading Privatization Hopes
• Negative Sentiment: Investor Michael Burry reportedly shifted from Fannie Mae and Freddie Mac common shares into preferred stock, warning that Treasury-related recapitalization could dilute common shareholders by at least 90% or potentially leave the common stock worthless. That highlights the central risk facing FNMA investors even if the companies are eventually released from government control. Why Michael Burry Is Swapping Fannie Mae Common Stock For Preferred Shares

Fannie Mae Company Profile

Fannie Mae, formally known as the Federal National Mortgage Association, is a government-sponsored enterprise that supports the U.S. housing finance system. It operates in the secondary mortgage market, purchasing eligible residential mortgage loans from approved lenders and providing liquidity that helps banks and other mortgage originators continue making loans to homebuyers and homeowners.

Fannie Mae primarily supports single-family and multifamily housing. It finances and securitizes qualifying mortgage loans into mortgage-backed securities and generally guarantees the timely payment of principal and interest to investors in those securities.