Wunderlich Has Buy Rating On American Capital Agency Corp. (AGNC)

Wunderlich Securities has a Buy rating and a $34 price target on shares of American Capital Agency Corp. AGNC. In a note to clients, Wunderlich writes, "Capital raising by seven of the mortgage REITs under our coverage has probably paused for a breather at this point, since the shares are trading at an average premium to trailing book value that probably will not support book accretion. Nonetheless, the ability of these companies to arbitrage the market value premium in their stocks could allow for an expanded pace of value creation in the form of dividends. If multiples expand as evidence mounts that value was created with that incremental capital, as we believe was the case, capital raising could resume in the early summer, in our opinion. To date, this group has raised nearly $7 billion through spot offerings, expanding footings by an aggregate 25%." Shares of AGNC lost 12 cents on Friday to close at $29.02.