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Patrick Harden  

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  • Prospect Capital: It's About Stability [View article]
    From the 40-APP, again: "In April 2015, the Company formed PRIT as a wholly-owned subsidiary and Maryland corporation. PRIT’s portfolio is currently indirectly owned by the Company through two wholly owned REITs, American Property Realty Corporation (“APR”) and United Property Realty Corporation (“UPR” and together with APR, the “PSEC REITs”). The PSEC REITs collectively own interests in eight joint ventures (the “Joint Ventures”) in which their ownership interest ranges from 70.3% to 99.3% (the “Joint Venture Interests”). The Joint Ventures represent 40% of the Company’s real estate portfolio at cost as of June 30, 2015. The Company intends to enter into a contribution agreement with PRIT and its operating company pursuant to which the PSEC REITs would contribute their Joint Venture Interests, together with $50 million in cash (collectively, the “PRIT Transfer Assets”) to PRIT and its operating company in exchange for (i) 100% of the PRIT common stock to be sold by the PSEC REITs upon the exercise of the rights in the rights offering and (ii) the PSEC retained interest in the form of operating partnership units."

    No mention of National Property. I don't think it's going in the spin.
    Nov 19, 2015. 10:45 AM | Likes Like |Link to Comment
  • Prospect Capital: It's About Stability [View article]
    One of the spins is an equity REIT. From the 40-APP filing: "Prospect Realty Income Trust ("PRIT") is a newly organized, externally managed Maryland corporation focused primarily on the ownership, acquisition and management of Class B multifamily apartment rental properties. PRIT intends to elect to be taxed and to operate in a manner that will allow it to qualify as a real estate investment trust (“REIT”) for U.S. federal income tax purposes."

    I don't think this spin currently includes the assets of National Property, though. I think it will include the assets of two of the other private REITs.
    Nov 18, 2015. 01:58 PM | 1 Like Like |Link to Comment
  • Two Harbors: Grave Concerns [View article]
    When I read the 3Q earnings transcript, it was clear to me that TWO's dividend this year is being supported by capital gains. However, after this year, taxable income should come back more in line with core earnings. I would not be surprised to see TWO cut the quarterly dividend by 2 or 3 pennies in Q1 2016. I think it's largely priced into the stock.
    Nov 13, 2015. 06:42 PM | Likes Like |Link to Comment
  • GSV Capital declares $2.76 distribution [View news story]
    Except they're paying half of it in stock while trading 35% - 40% below NAV - very dilutive.
    Nov 5, 2015. 08:18 PM | Likes Like |Link to Comment
  • Get Up To Date On Annaly Capital Management's Q3 2015 In A Couple Of Minutes [View article]
    I was wondering what you thought about Annaly's presentation shift. I personally like it, since it smoothes out the distortion from swings in the CPR projections. I really like the direction Annaly is going under Kevin Keyes - they've really turned things around in the past few quarters in terms of investor consideration.
    Nov 4, 2015. 07:46 PM | 1 Like Like |Link to Comment
  • GSV Capital up 9.3% after announcing RIC/distribution plans [View news story]
    The press release was worded pretty vaguely. GSVC filed its 2013 tax return as a RIC, but because it hadn't received exemptive relief from the SEC allowing it to elect RIC status, it kept its deferred tax liabilities. This press release doesn't even address the 2013 taxable year.

    I assume they gave up on 2013, re-filed it as a C-Corp, and then qualified as a RIC for 2014 outright without SEC exemptive relief. I further assume that GSV is going to actually apply the RIC status to its GAAP bookkeeping now, resulting in the removal of its deferred tax liabilities and a nearly $1 increase in NAV.

    But based on this press release, who knows what actually is the deal?
    Oct 15, 2015. 11:26 AM | Likes Like |Link to Comment
  • A Proper Introduction To New Residential Investment Corp (Part 2) [View article]
    What are your thoughts around the tax drag from the servicer advances? NRZ has to hold those in a TRS because they aren't good REIT assets. Do you feel the return possibilities on servicer advances are high enough to outweigh the tax drag they create?
    Sep 24, 2015. 05:03 PM | Likes Like |Link to Comment
  • Two Harbors: Substantial Concern Over The Dividend [View article]
    Management actually spent a bit of time addressing the dividend on the Q2 earnings call this week. The dividend is currently being supported by capital gains from the sale of securities during H1. These gains are excluded from core earnings but are nonetheless part of REIT taxable income. Generating distributable income from asset sales is not a sustainable approach over the long term, but TWO estimates that it has only distributed 76% of estimated 2015 REIT taxable income YTD. Therefore, the dividend still has a cushion from capital gain income for the rest of 2015.
    Aug 6, 2015. 01:38 PM | 9 Likes Like |Link to Comment
  • Prospect Capital: Reconciling Different Points Of View [View article]
    It still isn't very clear what Prospect is going to do with the capital raised via the rights offering. The company is divesting itself of three pretty successful lines of business with no clearly articulated plan for what is going to replace that business.
    Jul 21, 2015. 04:36 PM | 1 Like Like |Link to Comment
  • Deconsolidate This: Buy Bimini Capital Management, Sell Orchid Island Capital [View article]
    I think you deserve a victory lap. Great analysis and actionable trade that delivered results very quickly. Kudos all around!
    Jul 10, 2015. 10:43 AM | Likes Like |Link to Comment
  • Orchid Island Capital declares $0.14 dividend [View news story]
    Oh lord, here come the pitchforks.
    Jul 10, 2015. 09:59 AM | 5 Likes Like |Link to Comment
  • Do Not Buy Annaly Capital, Yet [View article]
    I'm very surprised that Annaly has not made an offer for Chimera or at the very least increased its stake. I thought they were just waiting for Chimera to file its delinquent financials and get stabilized, but an NLY offer hasn't materialized. Given Annaly's rather vehement distaste for stock buybacks, why not employ AGNC's rather elegant solution of buying ANOTHER mREIT that is trading at a large discount to book - thereby taking advantage of a very accretive investment opportunity without decreasing assets under management.
    Jul 1, 2015. 04:08 PM | 3 Likes Like |Link to Comment
  • Capitol Federal Financial declares $0.25 dividend [View news story]
    This is a special dividend, not a bump in the normal quarterly dividend.
    Jun 1, 2015. 11:21 AM | Likes Like |Link to Comment
  • Fifth Street Finance's (FSC) CEO Todd Owens on Q2 2015 Results - Earnings Call Transcript [View article]
    LOL. I wish I'd had some popcorn for this one. Not quite as juicy as the PSEC call last quarter, but highly enjoyable nonetheless.
    May 11, 2015. 02:55 PM | 4 Likes Like |Link to Comment
  • Prospect Capital's Rights Offering: A Pure-Play Value Added Subsidiary [View article]
    I would like to know what kind of investments PSEC is planning on making with the rights offering proceeds that have a higher return than the equity tranches of CLOs.
    May 6, 2015. 01:02 PM | 2 Likes Like |Link to Comment