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Why Federal Home Loan Mortgage (FMCC) Is Up 5.0% After Michael Burry’s Fannie-Freddie Bet Shift

Simply Wall St · 2d ago
  • In recent days, investor Michael Burry disclosed sizable personal stakes in Fannie Mae and Freddie Mac, arguing that a future relisting and IPO could transform the government-controlled mortgage giants into more conventional, publicly traded franchises once legal and regulatory constraints ease.
  • His high-profile vote of confidence has sharpened focus on how Freddie Mac’s multifamily securitization engine and potential exit from conservatorship could reshape its role in US housing finance.
  • With Freddie Mac’s share price rising over the past week, we’ll examine how Burry’s bullish stance alters the company’s investment narrative.

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What Is Federal Home Loan Mortgage's Investment Narrative?

To own Freddie Mac today, you have to believe it can eventually move from a government‑controlled, capital‑constrained utility toward a more typical listed mortgage finance company, without losing its central role in US housing. That thesis still hinges on progress toward an IPO, regulatory clarity from the FHFA and Treasury, and steady execution in core engines like multifamily securitization and its growing automation toolkit. Michael Burry’s new stake and public comments about relisting add visibility and have clearly lifted sentiment in the short term, but they do not remove the fundamental political and legal bottlenecks that critics say could take years to resolve. If anything, the recent price jump pulls forward expectations and makes timing, board stability and Freddie’s still‑unprofitable profile more important near‑term swing factors than they were before.

Yet there is one structural overhang here that many new shareholders may be overlooking.

Federal Home Loan Mortgage's shares have been on the rise but are still potentially undervalued. Find out how large the opportunity might be.

Exploring Other Perspectives

FMCC 1-Year Stock Price Chart
FMCC 1-Year Stock Price Chart

Five fair value estimates from the Simply Wall St Community span roughly US$11.94 to about US$119.21, showing how far apart private investors are on Freddie Mac’s prospects. Set against today’s excitement around a possible IPO and exit from conservatorship, this spread is a reminder to weigh the political and regulatory clock as carefully as the upside story, and to compare several competing views before deciding where you stand.

Explore 5 other fair value estimates on Federal Home Loan Mortgage - why the stock might be worth over 10x more than the current price!

Build Your Own Federal Home Loan Mortgage Narrative

Disagree with this assessment? Create your own narrative in under 3 minutes - extraordinary investment returns rarely come from following the herd.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.