3 Things Investors Need to Know About Annaly Capital Management Stock

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RegExp("[?&]notifications=1(&|#|$)");"desktop"===y&&i&&b.test(window.location.search)&&(i.checked=!0)};ge("ybar-mod-notification",(function(e){var t={isUH3:"crunch"===e.getConfig().ytheme,notifContainer:document.getElementById("notification-container"),notifBadge:document.getElementById("notif-badge"),notifMenu:document.getElementById("ybarNotificationMenu"),notifMenuOpener:document.querySelector("#ybarNotificationMenu + label"),notifDropdown:document.getElementById("notifDropdownContainer"),tooltipContainer:document.querySelector(".".concat($n)),notifLabel:document.querySelector(".".concat(Xn))};t.notifDropdown&&so(e,t)}))}()}};]]>Reuben Gregg Brewer, The Motley FoolMon, November 10, 2025 at 2:59 PM GMT+1 5 min readAnnaly Capital Management is a mortgage REIT, a complicated niche of the broader REIT sector.The stock has a humungous 12%+ dividend yield, but the dividend isn't exactly stable.Annaly Capital does a good job of achieving its stated goal.10 stocks we like better than Annaly Capital Management ›The big draw for most investors when they look at Annaly Capital Management (NYSE: NLY) is going to be the gigantic 12.9% dividend yield. Don't get blinded by the yield, you need to do a deep dive to really understand what this real estate investment trust (REIT) is doing, or you could end up sorry you bought it. Here are the three most important things you need to know about Annaly Capital.A traditional real estate investment trust buys a physical property and then leases it out. That's easy to understand because it's exactly the same thing you would do if you bought a rental property. Annaly doesn't do that; it buys mortgages that have been pooled together into bond-like securities. That's not good or bad, but mortgage REITs are a different animal from property-owning REITs.Image source: Getty Images.For starters, you probably couldn't do what Annaly does. Second, the business is best viewed as something similar to a mutual fund, since the value of the company is basically the value of the mortgage securities it owns. Note, however, that Annaly makes use of leverage, which most mutual funds don't do. That debt is generally backed by the REIT's portfolio of mortgage securities. Leverage can improve performance during the good times, but it can also exacerbate the problems during hard times.It is perfectly fine to buy Annaly, but you need to do more homework here to ensure you truly understand what you are buying. If you don't, you may end up surprised by this investment in a not-so-desirable way.If you buy for the dividend yield and don't understand the mortgage REIT business well enough, the big surprise you are likely to get is from the dividend. Simply put, if you need the income your portfolio generates to pay your living expenses, you probably won't want to buy Annaly. As the chart below highlights, the dividend has been volatile over time.NLY Dividend data by YChartsThe dividend swings have been pretty dramatic, too. The largest quarterly dividend was a huge $3.00 per share, while the lowest was a tiny $0.14. There have been long periods in which the dividend trended lower, too, which would mean a steadily decreasing income stream for dividend investors. And while the most recent change in the dividend was an increase, the history here is very clear: Annaly's dividend is variable, and you need to be ready for that or you will be disappointed with your investment decision.CGU et Politique de confidentialitéPrivacy & Cookie SettingsMore InfoS&P Futures6,885.25 +13.75 (+0.20%)Dow Futures48,071.00 +41.00 (+0.09%)Nasdaq Futures25,737.25 +96.50 (+0.38%)Russell 2000 Futures2,466.50 +0.30 (+0.01%)VIX17.28 -0.32 (-1.82%)Gold4,138.00 +21.70 (+0.53%)PortefeuilleConnectez-vous pour accéder à votre portefeuilleSe connecterLes plus performantsEWTX Edgewise Therapeutics, Inc. 21.48 +3.20 (+17.51%)LB LandBridge Company LLC 85.55 +10.55 (+14.07%)DNLI Denali Therapeutics Inc. 17.58 +1.98 (+12.69%)APGE Apogee Therapeutics, Inc. 62.95 +6.18 (+10.89%)CWAN Clearwater Analytics Holdings, Inc. 18.40 +1.71 (+10.25%)Les moins performantsLIF Life360, Inc. 72.79 -20.51 (-21.98%)CRWV CoreWeave, Inc. 88.39 -17.22 (-16.31%)BTDR Bitdeer Technologies Group 15.02 -2.63 (-14.90%)CENX Century Aluminum Company 27.88 -4.43 (-13.71%)WULF TeraWulf Inc. 12.37 -1.93 (-13.50%)Les plus liquidesOPEN Opendoor Technologies Inc. 8.48 +0.51 (+6.40%)PLUG Plug Power Inc. 2.5300 -0.0300 (-1.17%)NVDA NVIDIA Corporation 193.16 -5.89 (-2.96%)BBAI BigBear.ai Holdings, Inc. 6.06 +0.35 (+6.13%)PFE Pfizer Inc. 25.51 +1.12 (+4.59%)Événements concernant les bénéficesÉvénements concernant mes bénéficesÉvénements concernant les bénéficesActions du momentAMD Advanced Micro Devices, Inc. 237.52 -6.46 (-2.65%)BTC-USD Bitcoin USD 103,178.64 -2,729.65 (-2.58%)MRK Merck & Co., Inc. 90.95 +4.20 (+4.84%)OKLO Oklo Inc. 104.22 -7.30 (-6.55%)ETH-USD Ethereum USD 3,444.91 -122.20 (-3.43%)Principaux événements économiques