Fannie Mae (OTCMKTS:FNMA) Stock Price Up 11% - What's Next?

Key Points

• Fannie Mae shares jumped 11% to $7.36 on Thursday, trading as high as $7.37 on lighter volume (~4.47M shares, 38% below the daily average).
• Analyst coverage is mixed; the consensus rating is Hold with a $14.30 average price target, though individual calls range from Strong Buy to Strong Sell (BTIG recently initiated coverage with a Buy and $20 target).
• The company’s latest quarter missed EPS ($0.60 vs. $0.68 estimate) with revenue roughly in line, and showed a low net margin (2.22%) and a negative return on equity (-49.21%), signaling underlying fundamental weaknesses despite the rally.

Fannie Mae (OTCMKTS:FNMA - Get Free Report)'s share price rose 11% on Thursday . The company traded as high as $7.37 and last traded at $7.36. Approximately 4,468,390 shares were traded during trading, a decline of 38% from the average daily volume of 7,211,305 shares. The stock had previously closed at $6.63.

Analyst Ratings Changes

FNMA has been the subject of a number of recent analyst reports. BTIG Research initiated coverage on Fannie Mae in a report on Monday, January 26th. They set a "buy" rating and a $20.00 price target for the company. B. Riley Financial reiterated a "neutral" rating on shares of Fannie Mae in a report on Thursday, February 12th. Finally, Zacks Research downgraded Fannie Mae from a "hold" rating to a "strong sell" rating in a report on Wednesday, February 11th. One analyst has rated the stock with a Strong Buy rating, two have assigned a Buy rating, one has given a Hold rating and two have assigned a Sell rating to the company's stock. According to MarketBeat.com, Fannie Mae presently has a consensus rating of "Hold" and a consensus price target of $14.30.

Fannie Mae Stock Performance

The company has a 50 day moving average price of $6.93 and a 200 day moving average price of $9.45. The company has a market capitalization of $9.16 billion, a price-to-earnings ratio of 2.83 and a beta of 1.73.

Fannie Mae (OTCMKTS:FNMA - Get Free Report) last issued its earnings results on Wednesday, February 11th. The financial services provider reported $0.60 EPS for the quarter, missing the consensus estimate of $0.68 by ($0.08). The firm had revenue of $7.33 billion during the quarter, compared to analyst estimates of $7.33 billion. Fannie Mae had a net margin of 2.22% and a negative return on equity of 49.21%.

About Fannie Mae

The Federal National Mortgage Association, commonly known as Fannie Mae OTCMKTS: FNMA, is a government-sponsored enterprise established by Congress in 1938 as part of the New Deal to support the U.S. housing market. Headquartered in Washington, DC, Fannie Mae's mission is to promote liquidity, stability and affordability in the mortgage market. The company operates by purchasing residential mortgage loans from financial institutions, pooling them into mortgage-backed securities (MBS), and providing guarantees to investors against borrower default.

In its core business, Fannie Mae works with mortgage lenders across the United States—including banks, credit unions and mortgage finance companies—to ensure a steady flow of capital for homebuyers and homeowners seeking refinancing.

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