Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Best Dividend Stocks for 2012 - Mortgage REITs

|Includes:Chimera Investment Corporation (CIM), CMO, CXS, CYS, DS, NYMT, PMT, TWO

Mortgage REITs Will Retain Attractive Returns in 2012:

Prefer non-Agency: Heading into 2012 we think that the hybrid/non-Agency REITs generally offer more attractive value with the potential for more capital appreciation plus a more stable dividend outlook given the attractive reinvestment environment.

TWO remains top pick: Against this framework Two Harbors remains our top pick among the mortgage REITs. The company has been opportunistically adding to its non-Agency position at incrementally accretive risk-adjusted yields. This combined with the Agency portfolio with favorable prepayment characteristics gives us confidence in the sustainability of the current 16.8% yield.

See the full table of mortgage REITs.

Stocks: CIM, CMO, CXS, CYS, DS, NYMT, PMT, TWO