Federal Agricultural Mortgage (NYSE:AGM) Announces Earnings Results

Key Points

• Farmer Mac reported quarterly EPS of $4.82, missing the $5.20 consensus, while revenue of $125.25 million topped estimates of $121.29 million.
• The company posted record business volume of $38.5 billion; first-nine-month revenue and core earnings rose 18.3% and 14.1% year over year. Management said it is on track to reach $40 billion in business volume in 2026, ahead of its prior timeline.
• Credit quality showed some weakening: the provision for credit losses was $11.1 million, including $4.4 million tied to a bankrupt telecommunications borrower, and substandard assets increased to 2.1% of the portfolio from 1.7%.

Federal Agricultural Mortgage (NYSE:AGM - Get Free Report) released its earnings results on Thursday. The credit services provider reported $4.82 earnings per share for the quarter, missing analysts' consensus estimates of $5.20 by ($0.38), FiscalAI reports. Federal Agricultural Mortgage had a return on equity of 18.90% and a net margin of 29.98%. The firm had revenue of $125.25 million for the quarter, compared to the consensus estimate of $121.29 million.

Here are the key takeaways from Federal Agricultural Mortgage's conference call:

• Farmer Mac reported record business volume of $38.5 billion and first-nine-month revenue of $357.9 million and core earnings of $163.1 million, up 18.3% and 14.1%, respectively, year over year. Management said it is on track to reach $40 billion in business volume in 2026, two years ahead of its Investor Day timeline.
• Growth was broad-based, led by infrastructure finance, where outstanding volume rose $920 million in the quarter; Renewable Energy recorded its largest-ever quarterly net growth, and Farm & Ranch loan approvals reached a third-quarter record. Management reiterated expected annual business volume growth of approximately 8%–11% through 2030, while noting strong pipelines in several segments.
• Credit indicators showed some deterioration: the provision for credit losses was $11.1 million, including a $4.4 million provision on a troubled telecommunications exposure that entered bankruptcy, and substandard assets rose to 2.1% of the portfolio from 1.7% in the prior quarter. Management attributed the substandard increase mainly to regional and commodity-specific Farm & Ranch stress, and said collateral values remained strong.
• Operating efficiency remained strong, with a 27.5% quarterly efficiency ratio, below the company’s 30% long-term target; management expects a 27%–29% ratio for full-year 2026. Core capital exceeded the statutory minimum by $735 million, although the Tier 1 Capital Ratio declined to 12.9% as risk-weighted assets grew.
• Farmer Mac is developing risk-transfer transactions, including a potential credit-linked note as early as this quarter, to manage credit risk and potentially create regulatory capital capacity. Management said it is discussing capital treatment with its regulator and expects to provide more detail in coming quarters; execution and benefits remain uncertain.

Federal Agricultural Mortgage Trading Down 3.5%

NYSE:AGM traded down $7.21 on Thursday, reaching $198.37. 163,060 shares of the stock traded hands, compared to its average volume of 114,397. Federal Agricultural Mortgage has a 1-year low of $136.57 and a 1-year high of $248.29. The company has a current ratio of 0.56, a quick ratio of 0.56 and a debt-to-equity ratio of 1.82. The company's 50 day moving average is $212.49 and its 200-day moving average is $189.53. The firm has a market capitalization of $2.15 billion, a price-to-earnings ratio of 10.83, a price-to-earnings-growth ratio of 0.76 and a beta of 1.02.

Federal Agricultural Mortgage Dividend Announcement

The business also recently declared a quarterly dividend, which was paid on Wednesday, September 30th. Stockholders of record on Tuesday, September 15th were paid a $1.60 dividend. The ex-dividend date of this dividend was Tuesday, September 15th. This represents a $6.40 annualized dividend and a dividend yield of 3.2%. Federal Agricultural Mortgage's dividend payout ratio is presently 34.95%.

Analysts Set New Price Targets

A number of research firms recently commented on AGM. Weiss Ratings restated a "hold (c)" rating on shares of Federal Agricultural Mortgage in a research report on Friday, September 25th. Zacks Research cut Federal Agricultural Mortgage from a "strong-buy" rating to a "hold" rating in a research note on Tuesday, September 29th. Finally, Keefe, Bruyette & Woods upped their target price on Federal Agricultural Mortgage from $228.00 to $255.00 and gave the stock an "outperform" rating in a report on Monday, August 3rd. One investment analyst has rated the stock with a Buy rating and two have given a Hold rating to the company's stock. Based on data from MarketBeat.com, the stock currently has a consensus rating of "Hold" and a consensus price target of $255.00.

Federal Agricultural Mortgage Company Profile

Federal Agricultural Mortgage Corporation, commonly known as Farmer Mac, is a federally chartered corporation that provides a secondary market for agricultural and rural lending. Established by Congress in 1988, the company is intended to improve the availability of credit for American agriculture and rural communities.

Farmer Mac purchases, guarantees and finances agricultural real estate loans, rural housing loans and loans supporting rural utilities and infrastructure. Its products and services also include financing for agricultural production and equipment, as well as liquidity and credit support for lenders through loan purchases, guarantees and securitization programs.

The company serves agricultural lenders, rural utilities, cooperatives and other eligible financial institutions across the United States.

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