Federal Home Loan Mortgage Corporation PFD 5.30% (FREJP): fair value, margin of safety and Wheel Score

Is FREJP undervalued?

FREJP has a margin of safety of 95%: the stock closed at 9.84 on 16 Oct 2026 against a GLS average fair value of 196.79. 8 of the 8 valuation models that produced a number sit above the price. Our screens treat a discount this large as a strong starting point for a cash-secured put, not as a verdict - the fair value is a model output, and a wide gap can mean the models are missing something the market knows.

There is a wide gap between Graham Number (46.54) and DCF (693.25). When the models are this far apart the "fair value" is really a range, and the margin of safety above should be read with that range in mind.

The nightly engine files FREJP under Value: positive earnings at a P/E of 18 or less.

Nine valuation models for FREJP

Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.

Quality and financial health

Federal Home Loan Mortgage Corporation PFD 5.30% scores 7 of 9 on the Piotroski F-score, the nine yes/no tests of profitability, leverage and efficiency on the latest annual accounts - a strong reading that passes the Sunday Scan's "6 or more" rule with room to spare. On durability FREJP scores 5.0/10 on the GLS Moat - a middle reading; the Scorecard on the Quote page's Financials tab shows which ten-year lines are steady and which are not.

Returns on capital are thin or negative - ROIC 0.3%, ROE 15.2%, ROA 0.3% - with debt at 48.38 times equity and a free-cash-flow yield of 659.9%. Debt of 48.38 times equity is on the high side for the sector and is worth checking against the cash flow before treating the stock as a long-term hold.

Federal Home Loan Mortgage Corporation PFD 5.30% pays no dividend, so the DDM model does not apply and a covered-call holder earns only the premium and any price gain. Revenue comes mainly from Single Family Guarantee 85%, Multifamily 15% (quarter Q2 FY2026).

Institutional ownership scores 5/10, insider activity 5/10 and Congressional trading 5/10 on the GLS smart-money scales.

Wheel Score 39: No options

No options are listed on Federal Home Loan Mortgage Corporation PFD 5.30% in our nightly snapshot. The Wheel Score is therefore capped at 39 (it reads 39) and the stock is left out of every options screen; the fair value and health figures above are still useful for a plain stock position.

Volume runs at 0k shares a day on a market cap of $1.9B, with a beta of 0.54 - a low beta, so day-to-day moves are smaller than the market's; the Stability part of the Wheel Score gives that 9 of 20.

The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls; it is updated nightly and is not a recommendation. The walkthrough lesson shows how the score fits into a trade, start to finish.

Upcoming events

The next earnings report is due on 4 Nov 2026 (before the open), 19 days away; a 30-45-day put sold today would expire after it, which is worth weighing against the premium.

Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.

Similar stocks in Financial - Mortgages

The 12 companies below are the closest to Federal Home Loan Mortgage Corporation PFD 5.30% by market cap within the Financial - Mortgages industry, each with its own fact sheet; the Compare page puts up to eight of them side by side.

⚖ Compare FREJP with 7 of them   All Financial Services stocks →