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Freddie Mac (FMCC) Risk Analysis

Public companies are required to disclose risks that can affect the business and impact the stock. These disclosures are known as “Risk Factors”. Companies disclose these risks in their yearly (Form 10-K), quarterly earnings (Form 10-Q), or “foreign private issuer” reports (Form 20-F). Risk factors show the challenges a company faces. Investors can consider the worst-case scenarios before making an investment. TipRanks’ Risk Analysis categorizes risks based on proprietary classification algorithms and machine learning. Freddie Mac disclosed 2 risk factors in its most recent earnings report. Freddie Mac reported the most risks in the “Legal & Regulatory” category.

Risk Overview Q3, 2025

Risk Distribution
2Risks
Sector Avg.Finance & CorporateTech & InnovationLegal & RegulatoryProductionAbility to SellMacro & Political
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Risk Change Over Time

Freddie Mac disclosed risks per quarterNo. of Risks0.7511.251.51.7522.25Q2Q3Q4Q12025Q2Q3Showing: Q3, 2025
Risks removedRisks addedRisks changedFreddie Mac Risk Factors
Risk Removed (6)Risk Changed (10)
  • Share Price & Shareholder Rights - Risk 1
    The Purchase Agreement and the terms of the senior preferred stock significantly limit our business activities. In the event of non-compliance with any Purchase Agreement covenants, Treasury may be entitled to specific performance, damages, and other remedies, and if the corrective actions we were to take were determined by FHFA to be insufficient, FHFA could impose penalties on us or take other remedial actions.

    The Purchase Agreement and the terms of the senior preferred stock place significant restrictions on our ability to manage our business, including limiting (i) our secondary market activities; (ii) the amount and type of single-family and multifamily loans we may acquire; (iii) the amount of indebtedness we may incur; (iv) the size of our mortgage-related investments portfolio; (v) our ability to maintain alignment and competitiveness with Fannie Mae issued UMBS; and (vi) our ability to pay dividends, transfer certain assets, raise capital, and pay down the liquidation preference of the senior preferred stock. The Purchase Agreement prohibits us from taking a variety of actions without Treasury's consent. Treasury has the right to withhold its consent for any reason. The warrant held by Treasury, restrictions on our business under the Purchase Agreement, and the senior status and net worth sweep dividend provisions of the senior preferred stock could adversely affect our ability to attract capital from the private sector in the future, should we be in a position to do so. For more information, see Conservatorship and Related Matters - Freddie Mac's Future is Uncertain. In the event of non-compliance with any Purchase Agreement covenants, Treasury may be entitled to specific performance, damages, and other such remedies as may be available at law or in equity. In addition, if the corrective actions we were to take or plan to take to comply with such covenants were determined by FHFA to be insufficient or unsuccessful, FHFA could impose penalties on us or take other remedial action.

Read and Evaluate the RiskReserved for Ultimate MembersUpgrade
Macro & Political (1)

Risk Highlights Q3, 2025

Main Risk Category
Legal & Regulatory
With 2 Risks
Number of Disclosed Risks
2
No changes from last report
S&P 500 Average: 32
Recent Changes
0Risks added
0Risks removed
0Risks changed
Since Sep 2025
Number of Risk Changed
0
No changes from last report
S&P 500 Average: 1

Risk Word Cloud

we are subject to mortgage credit risk. credit losses and costs related to this risk could adversely affect our financial results.subject to mortgage credit riskthe covid-19 pandemic has significantly and adversely affected general economic conditions and the housing market. these adverse changes, as well as the effects of actions taken in response to the pandemic, such as forbearance for freddie mac-owned mortgages and other relief measures, have significantly and adversely affected our business, results of operations, and financial condition and elevated our credit, market, and operational risk levels in 2020 and will likely continue to do so in 2021, and perhaps beyond.adversely affected general economic conditionswe are exposed to increased credit losses and credit-related expenses in the event of a major natural disaster, other catastrophic event, including a pandemic, or significant climate change effects.exposed to increased credit losseswe are exposed to counterparty credit risk with respect to our business counterparties. our financial results may be adversely affected if one or more of our counterparties fail to meet their contractual obligations to us.respect to our business counterpartiesour current net worth amount may not be sufficient to absorb potential losses and could result in our having to request additional draws from treasury in future periods.sufficient to absorb potential lossesif fhfa placed us into receivership, our assets would be liquidated. the liquidation proceeds might not be sufficient to pay claims outstanding against freddie mac, repay the liquidation preference of our preferred stock, or make any distribution to our common stockholders.sufficient to pay claims outstandingif fhfa placed us into receivership, our assets would be liquidated. the liquidation proceeds might not be sufficient to pay claims outstanding against freddie mac, repay the liquidation preference of our preferred stock, or make any distribution to our common stockholders.distribution to our common stockholderswe are exposed to counterparty credit risk with respect to our business counterparties. our financial results may be adversely affected if one or more of our counterparties fail to meet their contractual obligations to us.exposed to counterparty credit riskour current net worth amount may not be sufficient to absorb potential losses and could result in our having to request additional draws from treasury in future periods.our current net worth amountlegislative or regulatory actions could adversely affect our business activities and financial results. we face risk of non-compliance with our legal and regulatory obligations as a result of identified weaknesses in our compliance program.face risk of non-compliance

FAQ

What are “Risk Factors”?
Risk factors are any situations or occurrences that could make investing in a company risky. The Securities and Exchange Commission (SEC) requires that publicly traded companies disclose their most significant risk factors. This is so that potential investors can consider any risks before they make an investment. They also offer companies protection, as a company can use risk factors as liability protection. This could happen if a company underperforms and investors take legal action as a result. It is worth noting that smaller companies, that is those with a public float of under $75 million on the last business day, do not have to include risk factors in their 10-K and 10-Q forms, although some may choose to do so.
How do companies disclose their risk factors?
Publicly traded companies initially disclose their risk factors to the SEC through their S-1 filings as part of the IPO process. Additionally, companies must provide a complete list of risk factors in their Annual Reports (Form 10-K) or (Form 20-F) for “foreign private issuers”. Quarterly Reports also include a section on risk factors (Form 10-Q) where companies are only required to update any changes since the previous report. According to the SEC, risk factors should be reported concisely, logically and in “plain English” so investors can understand them.
How can I use TipRanks risk factors in my stock research?
Use the Risk Factors tab to get data about the risk factors of any company in which you are considering investing. You can easily see the most significant risks a company is facing. Additionally, you can find out which risk factors a company has added, removed or adjusted since its previous disclosure. You can also see how a company’s risk factors compare to others in its sector. Without reading company reports or participating in conference calls, you would most likely not have access to this sort of information, which is usually not included in press releases or other public announcements. A simplified analysis of risk factors is unique to TipRanks.
What are all the risk factor categories?
TipRanks has identified 6 major categories of risk factors and a number of subcategories for each. You can see how these categories are broken down in the list below. 1. Financial & Corporate Accounting & Financial Operations - risks related to accounting loss, value of intangible assets, financial statements, value of intangible assets, financial reporting, estimates, guidance, company profitability, dividends, fluctuating results. Share Price & Shareholder Rights – risks related to things that impact share prices and the rights of shareholders, including analyst ratings, major shareholder activity, trade volatility, liquidity of shares, anti-takeover provisions, international listing, dual listing. Debt & Financing – risks related to debt, funding, financing and interest rates, financial investments. Corporate Activity and Growth – risks related to restructuring, M&As, joint ventures, execution of corporate strategy, strategic alliances. 2. Legal & Regulatory Litigation and Legal Liabilities – risks related to litigation/ lawsuits against the company. Regulation – risks related to compliance, GDPR, and new legislation. Environmental / Social – risks related to environmental regulation and to data privacy. Taxation & Government Incentives – risks related to taxation and changes in government incentives. 3. Production Costs – risks related to costs of production including commodity prices, future contracts, inventory. Supply Chain – risks related to the company’s suppliers. Manufacturing – risks related to the company’s manufacturing process including product quality and product recalls. Human Capital – risks related to recruitment, training and retention of key employees, employee relationships & unions labor disputes, pension, and post retirement benefits, medical, health and welfare benefits, employee misconduct, employee litigation. 4. Technology & Innovation Innovation / R&D – risks related to innovation and new product development. Technology – risks related to the company’s reliance on technology. Cyber Security – risks related to securing the company’s digital assets and from cyber attacks. Trade Secrets & Patents – risks related to the company’s ability to protect its intellectual property and to infringement claims against the company as well as piracy and unlicensed copying. 5. Ability to Sell Demand – risks related to the demand of the company’s goods and services including seasonality, reliance on key customers. Competition – risks related to the company’s competition including substitutes. Sales & Marketing – risks related to sales, marketing, and distribution channels, pricing, and market penetration. Brand & Reputation – risks related to the company’s brand and reputation. 6. Macro & Political Economy & Political Environment – risks related to changes in economic and political conditions. Natural and Human Disruptions – risks related to catastrophes, floods, storms, terror, earthquakes, coronavirus pandemic/COVID-19. International Operations – risks related to the global nature of the company. Capital Markets – risks related to exchange rates and trade, cryptocurrency.