Fannie Mae (FNMA)
OTCQB OTCQB Primary 
Fannie Mae: A Deeply Misunderstood Story
Rarely has a stock been so disconnected from its intrinsic value. Years of political noise and complex structures have obscured a thesis with the most asymmetric risk/reward profile. The Trump administration is lined up to carry out the exit: cancellation of Senior Preferred Shares (SPS), partial conversion of Junior Preferreds (JPS) and privatization. The thesis is that the Treasury can cancel the SPS justifying that it has already recovered more than $300 billion in revenue vs $191 billion initial investment (>11% IRR).
Fannie Mae: Better Price, Plus One Less Obstacle
With Trump's Big, Beautiful Bill passed and FNMA's stock price lower, risk has decreased, making FNMA a Buy now. Book value approaches $100B, while market cap lags, offering attractive valuation; improved liquidity further strengthens the investment case. Key risk remains government actions on ending conservatorship, but recent progress and discussions increase confidence in a favorable outcome.
Fannie Mae's Undervalued Preferreds: Series S And T
Fannie Mae's Series S and T preferreds are deeply discounted, offering double-digit yields and significant upside if conservatorship ends. Both issues are likely candidates for redemption due to their high coupons, which could drive prices toward par and nearly double current value. Risks include alternate government actions and non-cumulative dividends, but strong earnings and incentives support dividend resumption and redemption.
Highly Asymmetric Bet On The Trump Administration Through Fannie Mae
Investing in Fannie Mae offers a high-risk, high-reward opportunity due to the potential exit from conservatorship, which could yield substantial returns if successful. The market underestimates the probability of Fannie Mae exiting conservatorship; I believe the chance is over 50%, compared to the market's 22%. Fannie Mae's stable business model and the Trump administration's track record of following through on his campaign promises make this a compelling asymmetric bet.
Fannie Mae Preferred Buying Opportunity
The recent market selloff presents a buying opportunity in Fannie Mae preferred shares. Lower mortgage interest rates should alleviate concerns that releasing Fannie Mae and Freddie Mac from government control will increase mortgage costs for homeowners. Preferred shares have less potential upside than FNMA common but are less risky.
Home buyers are fed up with high mortgage rates, Fannie Mae says
The vast majority of people in the U.S. believe it is a bad time to buy a home.
Fannie Mae: Checklist For Privatization
Fannie Mae (FNMA) presents a significant opportunity, especially if privatized, with potential stock value reaching $31-$34 per share, supported by Bill Ackman's analysis. Key considerations include maintaining low mortgage rates and addressing the senior preferred debt on Fannie Mae's balance sheet, with cautious optimism on both fronts. Housing Urban Secretary Scott Turner's recent push for privatization and Treasury Secretary Scott Bessent's focus on mortgage rates are pivotal developments since investors focused on the companies last month.
Billionaire Bill Ackman Thinks This Stock Could Skyrocket 500%. Why Does Wall Street Expect It to Plunge?
Bill Ackman built a net worth of $9.3 billion by spotting promising opportunities. The hedge fund manager doesn't usually reveal the opportunities he likes to the public.
Freddy Mac's Timetable Could Lag Fannie Mae's
Fannie Mae and Freddie Mac are both expected to be recapitalized during the Trump administration. FMCC shows higher growth and potential gains, but faces larger capital requirements and IPO delays, posing higher risks. Preferred stock conversion to common shares is advantageous for FNMA due to its earlier timeline, though several FMCC preferreds are cheaper.
Treasury pact 'clearest signal yet' Trump will release GSEs, says Compass Point
Compass Point senior policy and research analyst Ed Groshans says the agreement by the Department of the Treasury and Federal Housing Finance Agency to amend the preferred stock purchase agreements between Treasury and Fannie Mae (FNMA) and Freddie Mac (FMCC) is the "clearest signal yet" that the Trump administration will begin the process to release the government-sponsored enterprises from conservatorship. The Trump transition team is working with each federal agency to prepare to implement Trump's agenda once he is inaugurated, the analyst tells investors in a research note. It appears that the preparations at Treasury and FHFA have raised concerns for the Biden administration, which resulted in the publication of the letter agreement and side letter agreement," Compass adds. The firm expects Trump will direct the agencies' actions and any of the recent changes that are not aligned with Trump's goals will be undone. Shares of Fannie and Freddie are rallying this morning following the agreement. Fannie Mae +0.16 (+4.88%) Freddie Mac +0.1045 (+3.20%)
Fannie Mae: What Is It Worth?
Fannie Mae is one of the best 'Trump Trades', as it offers asymmetric rewards to risk. With the government's purchase warrants set to expire in 2028, I believe the GSE's status will be resolved in the next few years. However, I do not believe it is the 10x returns widely touted by speculators and hedge fund managers.
Fannie Mae CEO reveals hard truths about rising mortgage rates — and tells home buyers how to deal with it
Don't count on Fed cuts to lower mortgage rates. Instead, build a strong credit record so you qualify for the cheapest loan.
