NEW YORK - MFA Financial, Inc. (NYSE:MFA), a real estate investment trust, announced today the pricing of a $75 million public offering of its senior notes with a 9.000% yield, maturing in 2029. The company also provided underwriters a 30-day option to buy an additional $11.25 million in notes for over-allotments, with the offering set to close on April 17, 2024, pending customary closing conditions.
The notes, which have been assigned a BBB- investment grade rating by Egan-Jones Ratings Company, will be unsecured senior obligations of MFA Financial. Interest is to be paid quarterly starting August 15, 2024, with the notes set to mature on August 15, 2029. The company reserves the right to redeem the notes, fully or partially, at any time on or after August 15, 2026.
MFA Financial aims to list the notes on the New York Stock Exchange under the symbol "MFAO", anticipating trading to commence within 30 days post-issuance, subject to NYSE approval.
The proceeds from the offering are intended for general corporate purposes, including potential investments in mortgage-related assets and working capital needs, such as repaying debt under the company's existing repurchase agreements and its 6.25% Convertible Senior Notes due 2024.
Joint book-running managers for this offering include Morgan Stanley & Co. LLC, RBC Capital Markets, LLC, UBS Securities LLC, Wells Fargo Securities, LLC, and Piper Sandler & Co. The offering will be made under the company's existing shelf registration statement with the Securities and Exchange Commission, through a prospectus and a related prospectus supplement.
MFA Financial is known for investing in residential mortgage loans, mortgage-backed securities, and other real estate assets. Since its IPO in 1998, the company has returned over $4.7 billion in dividends to shareholders.
This press release contains forward-looking statements, and the company has cautioned that actual results may differ from expected outcomes. The offering's consummation and the application of its net proceeds are subject to numerous factors, some beyond the company's control.
The information in this article is based on a press release statement from MFA Financial, Inc.
InvestingPro Insights
MFA Financial, Inc. (NYSE:MFA) has recently made headlines with its public offering of senior notes. For investors considering this opportunity, it's essential to look at the company's financial health and market performance. According to real-time data from InvestingPro, MFA Financial has a market capitalization of approximately $1.07 billion, reflecting its size and market presence.
The company's P/E ratio stands at 22.58, suggesting that its shares are trading at a multiple that is relatively low compared to its near-term earnings growth potential. This is reinforced by the company's adjusted P/E ratio for the last twelve months as of Q4 2023, which is a similar 22.67.
One of the most compelling attributes of MFA Financial is its dividend yield, which is currently at a significant 12.61%. This is particularly noteworthy for income-focused investors, especially considering that MFA Financial has maintained dividend payments for 27 consecutive years.
The commitment to returning capital to shareholders is a positive signal regarding the company's financial stability and management's confidence in its business model.
Investors should also note that while analysts anticipate a sales decline in the current year, MFA Financial has been profitable over the last twelve months. This profitability, combined with the fact that the company's liquid assets exceed its short-term obligations, provides a cushion against potential downturns and underscores its financial resilience.
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