Polls showing an upswing for President Trump's re-election chances against top potential Democratic candidates favor housing finance and mortgage giants Fannie Mae and Freddie Mac, according to Height Capital Markets.
Under a continued Trump administration, the Federal Housing Finance Agency is likely to allow Fannie and Freddie
"In 2020, we expect significant progress" on both administrative and legal fronts, Groshans said, including ending the so-called 'net worth sweep" of Fannie and Freddie’s profits to the Treasury. "While the process is taking significantly longer than we initially projected, the momentum continues to be positive," he said.
Earlier, Cowen & Co. senior policy analyst Jaret Seiberg flagged the Senate confirmation of Mark Calabria as FHFA director in a note on the year's dominant policy issues. Seiberg said that Calabria has "done more in six months to advance the
Common shares in Fannie Mae have soared 188% during 2019, and Freddie Mac by 175%, on optimism that change is coming to the housing finance system. Fannie gained as much as 1.7% in Tuesday trading; Freddie rose as much as 2.1%.
Height's Groshans maintained a buy rating on all series of the junior preferred shares of Fannie and Freddie. He rates the common shares of both hold.
