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Fund Opens $7.8 Million Position in Farmer Mac Despite 20% S&P Underperformance

Motley Fool - Fri Feb 13, 2:07PM CST

Key Points

  • First Sabrepoint Capital Management initiated a new holding in the fourth quarter, buying up 44,500 shares of Federal Agricultural Mortgage Corporation.

  • The quarter-end AGM stake value increased by $7.81 million.

  • AGM position accounts for 3.01% of 13F reportable AUM.

On February 13, 2026, First Sabrepoint Capital Management LP disclosed a new position in Federal Agricultural Mortgage Corporation(NYSE:AGM), acquiring 44,500 shares with an estimated trade value of $7.81 million.

What happened

According to a SEC filing published February 13, 2026, First Sabrepoint Capital Management established a new position in Federal Agricultural Mortgage Corporation by acquiring 44,500 shares during the fourth quarter of 2025. The estimated transaction value was $7.81 million.

What else to know

  • This was a new position for the fund, now representing 3.01% of its 13F reportable assets under management.
  • Top holdings after the filing:
    • NYSE: TPB: $43.36 million (17.8% of AUM)
    • NASDAQ: FCFS: $31.08 million (12.8% of AUM)
    • NASDAQ: LAUR: $16.84 million (6.9% of AUM)
    • NASDAQ: CVCO: $15.95 million (6.6% of AUM)
    • NYSE: ATGE: $13.97 million (5.7% of AUM)
  • As of February 12, 2026, AGM shares were priced at $179.14, down 7.85% over the past year and underperforming the S&P 500 by 20.75 percentage points.

Company overview

MetricValue
Revenue (TTM)$402.4 million
Net income (TTM)$216.00 million
Dividend yield3.44%
Price (as of market close February 12, 2026)$179.14

Company snapshot

  • Federal Agricultural Mortgage Corporation offers a secondary market for agricultural, rural utility, and USDA-guaranteed loans, including purchasing, securitizing, and guaranteeing loan-backed securities.
  • The firm generates revenue primarily through interest income, guarantee fees, and securitization activities across Farm & Ranch, USDA Guarantees, Rural Utilities, and Institutional Credit segments.
  • It serves agricultural lenders, rural utility cooperatives, and financial institutions seeking liquidity and risk transfer solutions for rural and agricultural lending portfolios.

Federal Agricultural Mortgage Corporation (Farmer Mac) provides a secondary market for agricultural and rural infrastructure loans in the United States.

What this transaction means for investors

Farmer Mac has lagged the S&P 500 by more than 20 percentage points over the past year, yet the underlying business keeps expanding. In the third quarter, outstanding business volume topped $31.1 billion, net interest income rose 13% year over year to $98.5 million, and core earnings hit a record $49.6 million, or $4.52 per diluted share. Net effective spread reached a record $97.8 million, underscoring pricing power even in a volatile rate backdrop.

Within the portfolio, Farmer Mac’s secondary market model, spanning farm and ranch, rural utilities, broadband, and renewable energy, adds a kind of credit exposure tied to essential infrastructure rather than consumer spending.

Meanwhile, the balance sheet remains sturdy, with $1.7 billion in core capital and a Tier 1 ratio of 13.9% demand and net spreads stay resilient. If they do, today’s relative underperformance could look more like an entry point than a warning sign.

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Jonathan Ponciano has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Adtalem Global Education. The Motley Fool recommends Turning Point Brands. The Motley Fool has a disclosure policy.

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