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"Our biggest competitor for assets is the Fed," says CYS Investments (CYS) CEO Kevin Grant on...

"Our biggest competitor for assets is the Fed," says CYS Investments (CYS) CEO Kevin Grant on the earnings conference call, describing what may be becoming a frothy mREIT sector as yield-starved investors elbow out not only each other, but the central bank.
Comments (22)
  • itscalledcommonsense
    , contributor
    Comments (520) | Send Message
     
    No kidding.
    19 Jul 2012, 12:08 PM Reply Like
  • MexCom
    , contributor
    Comments (3050) | Send Message
     
    Very difficult to replace called securities with similar yields. My choice today was AGNC - nicely recovering from the stock offering, yesterday's drop. $AGNC
    19 Jul 2012, 12:09 PM Reply Like
  • ArtfulDodger
    , contributor
    Comments (2168) | Send Message
     
    Good choice, in my view, Mex. The best to your investing.
    19 Jul 2012, 12:10 PM Reply Like
  • IndyRacer57
    , contributor
    Comments (2) | Send Message
     
    I have traded in AGNC now for some time. In fact I have 600 shares now that has almost paid for themselves. Good stock for now.
    19 Jul 2012, 02:52 PM Reply Like
  • MexCom
    , contributor
    Comments (3050) | Send Message
     
    I'm a little top heavy with it - have 1,700 shares in my IRA. I also loaded up with DUK watch that baby get back up to its previous high.
    20 Jul 2012, 06:47 AM Reply Like
  • ArtfulDodger
    , contributor
    Comments (2168) | Send Message
     
    Mex:

     

    Used to be a utility head back in the `80s, but not now, especially under the political environment we are currently under.

     

    In my view, utilities ought to be bought when they're paying high dividends and are selling at cheap ratios — which ain't now.

     

    However, I wish you well with that particular investment. AGNC, too.
    20 Jul 2012, 07:33 PM Reply Like
  • TwistTie
    , contributor
    Comments (2477) | Send Message
     
    The Fed should be buying the equity that has disappeared from our homes.

     

    The Fed gives me $200,000 and I give them a open ended call option on $200,000 of my home's value above the current value.

     

    Something like that.
    19 Jul 2012, 12:36 PM Reply Like
  • chowzer
    , contributor
    Comments (42) | Send Message
     
    If you think the Fed is competing hard now, wait til QE3.
    19 Jul 2012, 01:46 PM Reply Like
  • AlbyVA
    , contributor
    Comments (566) | Send Message
     
    There won't be any QE3 unless the economy goes into Recession (Officially with two negative quarters). Until then, QE3 is a pipe dream for those holding assets hoping for a dollar devaluation.
    19 Jul 2012, 02:02 PM Reply Like
  • gh1616
    , contributor
    Comments (452) | Send Message
     
    I wouldn't count on it!! If this wasn't an election year I bet we would have QE3 of some sort implemented right now. It will not take a recession, Big Ben would see that as too late. But, that's why they call these posts opinions, what it takes to make a market......somebody's gonna be wrong!
    19 Jul 2012, 10:10 PM Reply Like
  • kingdad
    , contributor
    Comments (827) | Send Message
     
    If only we could get the general (suka) public interested in mReits and their great returns, that would serve to push share prices higher and gains somewhat lower. It would be a boon to the knowledgeable investors. we could make extra Capital Gains to augment those sweet dividends. so be sure to tell your pals about mReits and those nice dividends
    19 Jul 2012, 03:14 PM Reply Like
  • gh1616
    , contributor
    Comments (452) | Send Message
     
    kingdad........damn, I could mistake you for Jim Cramer!! HaHa
    19 Jul 2012, 10:04 PM Reply Like
  • kingdad
    , contributor
    Comments (827) | Send Message
     
    Every once in awhile I have to have one of those moments. It just feels sooooo Good to put it out there! Ahhh!
    20 Jul 2012, 11:25 AM Reply Like
  • footnotereader
    , contributor
    Comments (49) | Send Message
     
    The question is what's the likely dividend, if any, 5 yrs from now.
    19 Jul 2012, 03:30 PM Reply Like
  • mykee4u
    , contributor
    Comments (2) | Send Message
     
    who cares about 5 years from now when a 17%+ yearly dividend (ARMOUR) is about as close as a sure a bet for at least the next 30 months, My money is riding on Uncle Ben and his zero rate policy until further notce
    19 Jul 2012, 04:37 PM Reply Like
  • moishep
    , contributor
    Comments (23) | Send Message
     
    II have been a long-time holder of AGNC, MTGE, and HTS. I've done very well, both via appreciation and distributions. I think, however, that the risk/reward ratio for these stocks is too heavily weighted toward risk at this point in time, with the possible exception of HTS. The reason is that the premiums to book value are historically extremely high. AGNC and MTGE might have gotten way ahead of themselves. For example, for the last 5 quarters, here are the premiums over NAV for AGNC as I calculate them - 0%, 5%, 1.5%, 4%, 12%, 17%. The last 3 quarters for MTGE are: negative price to NAV, 4%, 9%. The price/NAV for HTS is high, but not nearly as extreme. As one of the commenters noted, the retail buyer might still clamor for these high yields, but the fact that the premiums to NAV are so high means, for me, that holding these stocks now is more a matter of "playing the market" than buying an investment whose stock is well-priced fundamentally..
    19 Jul 2012, 03:39 PM Reply Like
  • Mexicoway
    , contributor
    Comments (4) | Send Message
     
    So do you sell now?
    19 Jul 2012, 05:49 PM Reply Like
  • kingdad
    , contributor
    Comments (827) | Send Message
     
    I sold both near there highs as I saw AGNC and MTGE hitting upward resistance at 35 and 25 dollars respectively, So I took the money and ran. I've been proven right (at least this once). as both are down and both continue to be overbought as the MReit Mkt starts to contract with the various earning reports coming out in the next couple weeks will prove. Spread tightening, earnings forecasts down, Div safe for now but with likely downward pressure into the 4th Qtr..

     

    Translation: lower prices per share, revised earnings reports/forecasts, doubts as to dividend sustainability feeding back into the fist item, lower prices.

     

    All that being said the dividends are still next to unbeatable even if they take a hit later this year. If the Gov't ever does get the economy on track we can expect to see the spread widen (no QE3) and earnings to improve, dividends to stabilize and PPS to climb back up. ( my what a GOP, Hope filled, scenario that is).

     

    Long ARR CIM CYS NLYPRC NRFPRB
    20 Jul 2012, 11:35 AM Reply Like
  • mostserene1
    , contributor
    Comments (3330) | Send Message
     
    Why sell your cash cows just because they have appreciated. Unless they skyrocket, then take profits and buy another cheaper mREIT.

     

    Long MTGE and TWO.

     

    I don't think the fed will wait until recession to QE3; they will act if we are heading in that direction to kick-start the growth to stave off recession. Whether that works is anyone's guess, but it will help the market for a week or two.
    19 Jul 2012, 06:04 PM Reply Like
  • AlbyVA
    , contributor
    Comments (566) | Send Message
     
    I would diversify your mREIT holdings. I only hold 12 stocks. Half are mREITs and half are some other dividend yielders. All 12 holdings yield between 10% - 16% and each only hold about 8% of my wealth. My yearly yield ends up around 12%, which is okay with me.

     

    12% yield means you'll double your money about every 6/years.
    21 Jul 2012, 07:57 AM Reply Like
  • kingdad
    , contributor
    Comments (827) | Send Message
     
    I have a couple fewer stocks in my portfolios (wife and I) but I'd like to trade names to see if we can help each other out, Wife is now averaging 9-10% and I 11-12%) send a IM if interested. Making money for my retirement is essential these days.
    21 Jul 2012, 01:17 PM Reply Like
  • moishep
    , contributor
    Comments (23) | Send Message
     
    My comments on AGNC were very basic - The company has just announced that for the second quarter, the adjusted net income per share and the interest spread income per share show that AGNC earned substantially less on its portfolio than in the 2012 first quarter and in the 2011 second quarter. At the same time, the name is trading for the highest price/NBV premium, by a huge margin. It was 4% at the end our the second quarter last year, and it's grown to a year-and-a-half high of 17% premium to book. For comparison, MTGE sells at a 9% premium, and HTS sells for a 6% premium. So, much weaker performance and an extreme premium over book value - t just seems to me that holding the stock at this point in time is a matter of gambling that people will keep pushing fo yield, disregarding fundamentals of the company and an almost historically bloated price for the stock, instead of buying stock in a company whose fundamentals are strong (or even stable) and whose stock price is not so widely above previous levels, which has been the case up until recently. Many of us have made a lot of money on price growth on this stock. I'm not a big fan of Cramer, but as he says (and it's not original, I've heard it for years in the real etate investment business), bulls win, bears win, but pigs get slaughtered. The next ex date is not for a couple of months so I'm sitting it out to see what happens, and my bank account is enjoying the profit that it's just received via my sale of AGNC.
    21 Jul 2012, 01:49 PM Reply Like
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