It's mission accomplished at Javelin Mortgage (JMI) for Phil Goldstein's Bulldog Investors, but there are other "vulnerable companies," says JMP's Steve Delaney. “Management doesn’t have a lot to stand on if the REIT’s stock is trading at 80 percent of its book value."
Javelin has returned 33% since Bulldog disclosed a stake (and called for fast buybacks) late last summer even as the rest of the sector - including giants Annaly (NLY) and American Capital Agency (AGNC) - continued to decline. Goldstein has deferred to comment on his next target but has said he's eyeing both equity and mortgage REITs.
Anworth Mortgage (ANH) - trading in the area of a 30% discount to book - is a "clear target" for an investor like Goldstein, says Delaney. The company repurchased 2.8M shares in Q4 and boosted its authorization to another 5M.
Annaly and American Capital are likely too big to be targets, says Delaney, as is a smaller shop with a big backer like Leon Black's Apollo Residential Mortgage (AMTG).