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  • Consider Buying Western Asset Mortgage Capital Now [View article]
    I think you might be right, but its hard to buy this after a dividend drop and a book value drop with the announced dividend. With MBS prices going up, they should have had a higher book value, not a lower one. That alone could have changed this pattern in the eyes of investors and a return to 17$ might not happen. It would take a great Q1 earnings report that shows earnings covering the dividend and a book value increase. That could happen if they used the secondary cash to buy a lot of MBS and not more hedging.
    Apr 17 10:51 PM | 1 Like Like |Link to Comment
  • Western Asset Mortgage - Is 18% Rational? [View article]
    Predictions of dividend reductions and book value erosion presuppose that the newly invested money will go into MBS at a leverage amount that will not create as much income as currently held investments and that the secondary was done below book value and that the MBS they buy will loose value. If you take FEB 28th book value of 15.18 and subtract the .67 dividend, book value would have been 14.51. Most of the shares traded on the day of the secondary were above that by a bit. MBS values have gone up since April 4th by almost a full 1%, but they are down about 1/3 of a percent since FEB 28th. If the FEB 28th announced book value drop is an indication though, WMC book value should go up when MBS values fall unless they have reduced hedges since then. The mortgage interest rate has been rising so they may be able to get a higher spread than with currently owned MBS. The time in between earnings reports is always a guessing game as to what the portfolio changes are, so predictions are tough. You may be right, but I think the numbers show it might not be as bad as you predict.
    Apr 9 02:20 PM | 4 Likes Like |Link to Comment
  • Insider buy at Western Asset Mortgage [View news story]
    Secondaries are usually announced fairly soon after ex dividend day and when the stock is trading at a premium to book value. The reasons for that is so they have time to earn money on the new investments from the secondary cash to pay the next dividend and for the secondaries to be accretive to book value. You can't know beforehand, but you can guess as to which company is going to do a secondary and when.
    Apr 8 03:41 PM | Likes Like |Link to Comment
  • ARMOUR And Five Oaks: Which High-Yielding Residential REIT Is A Buy? [View article]
    What about ORC? That's a monthly payer mREIT that has a higher yield and higher price to book than ARR or OAKS. Id be picking that over ARR or OAKS if I was in the monthly payer mREIT market.
    Apr 2 03:00 PM | Likes Like |Link to Comment
  • Western Asset Mortgage Q4 Changes And Outlook [View article]
    Nice moves. Ive stayed long both of them since early last year, only WMC is in the black for me, but MORL could break even next month after the dividend. I think MORL will announce a dividend for April that should be as least as big as January. A secondary or an earnings report from WMC might give you your price target. There also might be a lot of people moving their money after the ex dividend date if there are higher yields to be had in ORC and MORL.
    Mar 21 11:07 AM | 1 Like Like |Link to Comment
  • Western Asset Mortgage Q4 Changes And Outlook [View article]
    WMC just got passed by ORC in yield, but the price is holding up today (21 MAR) better than I thought it would. I would assume that the hedges lost more value than the MBS gained from 1 Jan until 28 FEB this year. I've never found a way to value swaps other than the rate on them, but 10 year swaps lost .3% while the MBS gained about 2%. The rest of the mREITs except DX announced unchanged dividends or even raised dividends (CMO). Hard to see why WMC should have this high of price to book if they are loosing on the total return side (BV change + dividend) this quarter AND dropping the dividend when others aren't. There might be a secondary offering in the works for WMC if they are this high above BV.
    Mar 21 10:24 AM | 1 Like Like |Link to Comment
  • Western Asset Mortgage Q4 Changes And Outlook [View article]
    15.18 BV on FEB 28th and dividend at .67 cents. My initial reaction was they probably didn't take off the hedges and didn't lever up because they lost BV when MBS prices were going up. WMC is playing it more cautiously these days for sure. Without the new shares it would have come to .73 for the dividend, still a massive cut from the .90 it was last year. Not what I was expecting. Im sure there will be a lot of selling tomorrow. might be a good buying opportunity, its still yielding 16.5%
    Mar 20 08:39 PM | Likes Like |Link to Comment
  • How Does An Intelligent Investor Navigate Mortgage REIT Risk? [View article]
    Adjustable rate mortgages adjust up the interest rate on the loan when the short term rates rise, which as Janet Yellin indicated may be sooner than people had thought - like spring of 2015. Some of the ARM mREITs are HTS, CMO, and MFA. Others hold a smaller portion of the portfolio as ARMs - MITT, CYS, ARR, IVR.
    Mar 19 05:52 PM | 1 Like Like |Link to Comment
  • New York Mortgage Outperformed Armour Residential By About 36% In 2013... In 2014? [View article]
    MORL matures in 2042, you've got 30 years. take a look at their risks page - http://bit.ly/16LIO7F They are tied to UBS and their business, and they will redeem shares if it falls below 5$ a share or goes down 60% in a month.
    Mar 18 11:48 AM | Likes Like |Link to Comment
  • New York Mortgage Outperformed Armour Residential By About 36% In 2013... In 2014? [View article]
    I think MORL is a buy now - increased book values and increased dividends are likely happening this year in mREITs due to the more stable interest rate environment we are seeing. Dividend announcements of the major holdings in the index are about to announce, and they likely will maintain the dividends like CYS did or increase them like CMO and NRF. There is still some discount to book value that will go away if rates stay range bound like they have been this year and book values are stable or rising in the Q2 earnings reports. I don't see a significant pullback happening, there is still some trepidation in mREITs from last years huge drop from the interest rate jump, but its going away and I think this might be your last chance to get in while you still have some discount to book value and price appreciation potential in the near future.
    Mar 17 11:32 PM | 2 Likes Like |Link to Comment
  • New York Mortgage Trust: The Best mREIT In America Is Firing On All Cylinders [View article]
    That's a great point xxavatarxx, .27 of the 1.08 paid out last year was return of capital. Only Q4 had a dividend that didn't have some return of capital http://bit.ly/1fUwhSf
    Mar 17 10:05 PM | 1 Like Like |Link to Comment
  • New York Mortgage Trust: The Best mREIT In America Is Firing On All Cylinders [View article]
    They wouldn't use the secondaries to pay the dividend, just to invest so that their investments can pay the dividend. I was just saying they wouldn't do a secondary before ex dividend day because they wouldn't want to pay the dividend on those new shares.
    Mar 17 07:48 PM | 1 Like Like |Link to Comment
  • New York Mortgage Trust: The Best mREIT In America Is Firing On All Cylinders [View article]
    Definitely looking for an opportunity to get more into NYMT. Thanks for the color on the secondaries. The upcoming ex dividend date of 20 Mar is also an opportunity to get in, but a secondary offering would be a better day to get in. I think they will at least wait until after going ex dividend to do a secondary, but not too long after so that can use the secondary offering cash to generate income needed to sustain the next dividend.
    Mar 17 06:52 PM | 1 Like Like |Link to Comment
  • Insider buy at Western Asset Mortgage [View news story]
    Interesting question. Id think they would wait till ex dividend day before making a secondary so as not to have to pay that dividend on new shares that haven't earned them anything. But this makes a secondary less likely I think.
    Mar 14 12:52 PM | Likes Like |Link to Comment
  • New York Mortgage Outperformed Armour Residential By About 36% In 2013... In 2014? [View article]
    Contrasting the best (NYMT) with the worst (ARR), I like it! Given ARR's track record and managements pay incentives (based on new share issuance) I wouldn't buy shares, and I'm not too thrilled that right now ARR is in my MORL position as part of the index. Id rather they trade out ARR with NYMT or WMC in the MORL index. That been said, I think the BV on ARR is up this quarter if they haven't drastically changed the portfolio because MBS prices are up. NYMT has shown it will do well regardless of some pretty big interest rate swings. ARR has shown it needs lowering long term rates and low short term rates to generate a positive return.
    Mar 14 11:52 AM | 1 Like Like |Link to Comment
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236 Comments
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