Head-To-Head Review: Federal Agricultural Mortgage (AGM) and Its Peers

Federal Agricultural Mortgage (NYSE:AGM) is one of 19 publicly-traded companies in the “FIN – MTG&REL SVS” industry, but how does it compare to its peers? We will compare Federal Agricultural Mortgage to related companies based on the strength of its analyst recommendations, valuation, risk, profitability, dividends, institutional ownership and earnings.

Dividends

Federal Agricultural Mortgage pays an annual dividend of $6.00 per share and has a dividend yield of 3.3%. Federal Agricultural Mortgage pays out 37.1% of its earnings in the form of a dividend. As a group, “FIN – MTG&REL SVS” companies pay a dividend yield of 3.1% and pay out 45.4% of their earnings in the form of a dividend. Federal Agricultural Mortgage has increased its dividend for 14 consecutive years. Federal Agricultural Mortgage is clearly a better dividend stock than its peers, given its higher yield and lower payout ratio.

Insider and Institutional Ownership

68.0% of Federal Agricultural Mortgage shares are held by institutional investors. Comparatively, 52.2% of shares of all “FIN – MTG&REL SVS” companies are held by institutional investors. 2.2% of Federal Agricultural Mortgage shares are held by company insiders. Comparatively, 30.3% of shares of all “FIN – MTG&REL SVS” companies are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Federal Agricultural Mortgage and its peers revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Federal Agricultural Mortgage	$1.62 billion	$207.19 million	11.23
Federal Agricultural Mortgage Competitors	$18.33 billion	$1.82 billion	-68.95

Federal Agricultural Mortgage’s peers have higher revenue and earnings than Federal Agricultural Mortgage. Federal Agricultural Mortgage is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Profitability

This table compares Federal Agricultural Mortgage and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Federal Agricultural Mortgage	12.65%	18.77%	0.65%
Federal Agricultural Mortgage Competitors	-5.93%	-85.16%	-0.75%

Volatility and Risk

Federal Agricultural Mortgage has a beta of 0.99, suggesting that its stock price is 1% less volatile than the S&P 500. Comparatively, Federal Agricultural Mortgage’s peers have a beta of 1.33, suggesting that their average stock price is 33% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and target prices for Federal Agricultural Mortgage and its peers, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Federal Agricultural Mortgage	0	1	0	0	2.00
Federal Agricultural Mortgage Competitors	154	682	989	15	2.47

Federal Agricultural Mortgage presently has a consensus price target of $215.00, indicating a potential upside of 18.37%. As a group, “FIN – MTG&REL SVS” companies have a potential upside of 21.99%. Given Federal Agricultural Mortgage’s peers stronger consensus rating and higher probable upside, analysts plainly believe Federal Agricultural Mortgage has less favorable growth aspects than its peers.

Summary

Federal Agricultural Mortgage peers beat Federal Agricultural Mortgage on 8 of the 15 factors compared.

About Federal Agricultural Mortgage

Federal Agricultural Mortgage Corporation provides a secondary market for various loans made to borrowers in the United States. It operates through four segments: Corporate AgFinance, Farm & Ranch, Rural Utilities, and Renewable Energy. The company’s Agricultural Finance line of business engages in purchasing and retaining eligible loans and securities; guaranteeing the payment of principal and interest on securities that represent interests in or obligations secured by pools of eligible loans; servicing eligible loans; and issuing LTSPCs for eligible loans. Its Rural Infrastructure Finance line of business is involved in the purchase of rural utilities loans and renewable energy loans and guarantees of securities backed by loans, as well as LTSPCs for pools of eligible rural utilities loans; by loans for electric or telecommunications facilities by lenders organized as cooperatives to borrowers; and other financial institutions that are secured by pools of eligible loans. Federal Agricultural Mortgage Corporation was incorporated in 1987 and is headquartered in Washington, the District of Columbia.