Compass Point Reiterates a 'Buy' on Federal Agricultural Mortgage Corp (AGM); Farmer Macin' Out
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Price: $230.90 -0.77%
Rating Summary:
3 Buy, 1 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 11 | Down: 18 | New: 20
Rating Summary:
3 Buy, 1 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 11 | Down: 18 | New: 20
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Compass Point reiterates a 'Buy' on Federal Agricultural Mortgage Corp (Farmer Mac) (NYSE: AGM) price target of $41.00.
Analyst, Mike Turner, said, "Increased originations, near pristine credit quality and an 18% (core) ROE in 2Q12 support our Buy-rated thesis. While the record drought this summer will heighten near-term concerns, we expect AGM's conservative underwriting policies to mitigate loss potential. Longer-term, we see substantial growth potential in their core Farmer Mac I program (as rising rates should inhibit farmers to refinance from a bank-owned loan into a fixed rate product that would likely be sold to AGM). Further, the clean energy movement and rural utility upgrades would support growth in their Rural Utility segment. In the meantime, we continue to find the stock incredibly cheap given that they are earning a mid-teens ROE and are trading at a slight discount to book value (and only 5x our FY13 EPS estimate)."
FY12 EPS estimate raised from $4.40 to $4.49, but lowers FY13 from $4.52 to $4.47.
For an analyst ratings summary and ratings history on Federal Agricultural Mortgage Corp (Farmer Mac) click here. For more ratings news on Federal Agricultural Mortgage Corp (Farmer Mac) click here.
Shares of Federal Agricultural Mortgage Corp (Farmer Mac) closed at $25.14 yesterday.
Analyst, Mike Turner, said, "Increased originations, near pristine credit quality and an 18% (core) ROE in 2Q12 support our Buy-rated thesis. While the record drought this summer will heighten near-term concerns, we expect AGM's conservative underwriting policies to mitigate loss potential. Longer-term, we see substantial growth potential in their core Farmer Mac I program (as rising rates should inhibit farmers to refinance from a bank-owned loan into a fixed rate product that would likely be sold to AGM). Further, the clean energy movement and rural utility upgrades would support growth in their Rural Utility segment. In the meantime, we continue to find the stock incredibly cheap given that they are earning a mid-teens ROE and are trading at a slight discount to book value (and only 5x our FY13 EPS estimate)."
FY12 EPS estimate raised from $4.40 to $4.49, but lowers FY13 from $4.52 to $4.47.
For an analyst ratings summary and ratings history on Federal Agricultural Mortgage Corp (Farmer Mac) click here. For more ratings news on Federal Agricultural Mortgage Corp (Farmer Mac) click here.
Shares of Federal Agricultural Mortgage Corp (Farmer Mac) closed at $25.14 yesterday.
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