Agnc Investment . Cum Conv Red Pfd Registered Shs Series D Stock Earnings Reports

AGNC reported a challenging Q1 2026 with an economic return on tangible common equity of -1.6% (comprehensive loss of $0.18 per common share). Performance was driven by two divergent themes: strong agency MBS performance early in the quarter following a presidential directive for GSE MBS purchases, and materially wider spreads and higher volatility in March due to the Middle East conflict. Despite the quarterly weakness, agency MBS outperformed Treasuries and investment-grade corporates, and the firm views current spread levels (roughly 150–175 bps current coupon to swaps; ~140–150 bps on an average basis) as compelling value. AGNC increased net spread and dollar roll income (to $0.42 per share) driven by a 25 bps increase in net interest spread, favorable TBA implied financing, lower repo funding costs, and higher swap allocation. Portfolio actions included modest growth ($1.7B purchases, concentrated in lower-coupon specified pools), rotation down-in-coupon, increasing swap hedges (notional $64B, higher share of swap hedges in duration terms), and retaining a positive duration gap as prepayment protection. Leverage ended the quarter at 7.4x (average 7.4x), with substantial liquidity (~$7B unencumbered cash and Agency MBS, ~60% of tangible equity). AGNC issued $401M of common equity via ATM at a premium to tangible book, which management says was accretive and provided optionality during volatility. Management remains constructive on agency MBS over time if geopolitical risks ease and Fed easing becomes more likely, but will be opportunistic on leverage, hedging and coupon selection given near-term volatility.