Fannie Story

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FNMA -- USA Stock  

USD 2.00  0.04  1.96%

Fannie Mae Average Assets are projected to increase significantly based on the last few years of reporting. The past year's Average Assets were at 3.47 Trillion. The current year Earnings Before Interest Taxes and Depreciation Amortization EBITDA is expected to grow to about 19 B, whereas Enterprise Value is forecasted to decline to about 3150.8 B. This short post will go over Fannie Mae as a possible investment alternative for your portfolios. We will provide a perspective on Fannie Mae future direction.
Published over a month ago
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Should you continue to rely on Fannie Mae (OTC:FNMA) management?
About 22.0% of Fannie Mae shares are owned by institutional investors. Insiders ownership of Fannie Mae refers to the amount of Fannie Mae equity owned by Fannie officers, directors, relatives of the leadership team, or anyone who has access to private information before it's made available to the public. Check out our latest analysis of Fannie, including its current ownership diagnostics.
There are currently many different techniques concerning forecasting the market as a whole as well as predicting future values of individual securities such as Fannie Mae. Regardless of method or technology, to accurately forecast the stock market is more a matter of luck rather than a particular technique. Nevertheless, trying to predict the stock market accurately is still an essential part of the overall investment decision process. Using different forecasting techniques and comparing the results might improve your chances of accuracy even though unexpected events may often change the market sentiment and impact your forecasting results.

Predictive Modules for Fannie Mae


How important is Fannie Mae's Liquidity

Fannie Mae financial leverage refers to using borrowed capital as a funding source to finance Fannie Mae ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Fannie Mae financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between Fannie Mae's total debt and its cash.

How Fannie utilizes its cash?

To perform a cash flow analysis of Fannie Mae, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Fannie Mae is receiving and how much cash it distributes out in a given period. The Fannie Mae cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities. Fannie Mae Net Cash Flow from Operations is projected to increase significantly based on the last few years of reporting. The past year's Net Cash Flow from Operations was at (4.75 Billion)

Sale by Bon Salle Andrew of 6500 shares of Fannie Mae

Legal trades by Fannie Mae insiders are very common, as founders, directors, or employees of any publicly traded firm often have stock or stock options. These trades are made public in the United States through the filing of Form 4 of the Securities and Exchange Commission. Below entry was recorded recently and is publicly available as an insider trade:
Fannie insider trading alert for sale of common stock by Bon Salle Andrew, EVP-SF UW Pricing Cap Mkt, on 11th of September 2020. This event was filed by Federal National Mortgage with SEC on 2013-05-29. Statement of changes in beneficial ownership - SEC Form 4 [view details]   
Note, although insider trading is legal, in the United States, Canada, Australia, and Germany, for mandatory reporting purposes, corporate insiders are defined as a company's officers, directors, and any beneficial owners of more than 10% of a class of the company's equity securities.

Breaking down the case for Fannie Mae

Fannie Mae currently demonstrates below-verage downside deviation. It has Information Ratio of 0.03 and Jensen Alpha of 0.29. However, we do advice investors to further question Fannie Mae expected returns to ensure all indicators are consistent with the current outlook about its relatively low value at risk.

Returns Breakdown

Return on Assets0.004316
Return on Equity1.81
Return Capital0.003723
Return on Sales0.74

Are Fannie Mae technical ratios showing a throwback?

Current standard deviation is at 3.71. Fannie Mae currently demonstrates below-verage downside deviation. It has Information Ratio of 0.03 and Jensen Alpha of 0.29. However, we do advice investors to further question Fannie Mae expected returns to ensure all indicators are consistent with the current outlook about its relatively low value at risk.

Our Takeaway on Fannie Mae Investment

Whereas other companies under the mortgage finance industry are still a bit expensive, Fannie Mae may offer a potential longer-term growth to investors. The inconsistency in the assessment between current Fannie valuation and our trade advice on Fannie Mae is due to the recent market swings and your selection of investing horizon. Please use our equity advice module to run different scenarios to ensure your current risk level and investment horizon are fully reflective of your current investing preferences in regards to Fannie Mae.

About Contributor

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Vlad Skutelnik do not own shares of Fannie Mae. Please refer to our Terms of Use for any information regarding our disclosure principles.

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