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ARMOUR Residential (ARR -2.1%) gets hit with a huge sell order (check out the volume here)....

ARMOUR Residential (ARR -2.1%) gets hit with a huge sell order (check out the volume here). Fresh off a July 9 secondary (it's 3rd in 8 months!), the stock has flown right past that decline to new 52-week highs. Look for another "huge" secondary, says Dividend Master, estimating the stock trades at a 14% premium to book value. Shares +9% YTD with a 15.6% annualized dividend.
Comments (17)
  • Still going to ride ARR for the rest of 2012 and probably all of 2013. Until interest rates recover there is no reason to run away from a +15% dividend. Not to mention I got in at under $7.
    31 Jul 2012, 12:53 PM Reply Like
  • Do u care to give me ur opinion as to what is an ok price to buy it currently for someone who is retired and doesn't own it yet ?
    31 Jul 2012, 03:57 PM Reply Like
  • $7 was my real comfort spot. With the yield still at +16% I would be fine with $7.50.


    Beyond that I would make sure to have a stop at 5% lower than the buy in. That may be a little conservative for some people but I'd rather not lose more than 5% on something that I consider risky (given it's short history and market sector). That said it is also my top performer for the year so far.
    1 Aug 2012, 11:00 AM Reply Like
  • Read on! Capt. JP
    2 Aug 2012, 01:44 AM Reply Like
  • ARR is the best bet out there right now. Recovered nicely and will continue to on it's uptick for now.
    31 Jul 2012, 01:07 PM Reply Like
  • And why quote some random 'dividend master' off of Twitter? Smells like someone had a short play on...
    31 Jul 2012, 01:28 PM Reply Like
  • ARR has a pattern of frequent secondaries, and the stock is trading at a significant premium. I wouldn't be surprised if they raised capital again shortly after issuing Q2 earnings.
    31 Jul 2012, 01:37 PM Reply Like
  • It just does not get better then ARR both for 15% div. and growth. You win both ways for now.
    31 Jul 2012, 04:14 PM Reply Like
  • I feel like a pig at the trough, oink oink may add to my position if price gets close to 7 again...
    31 Jul 2012, 04:18 PM Reply Like
  • ARR continues to be one of the best managed REITs. Looking forward to an increase of the dividend after earnings are announced. Agree with riding through 2013.
    31 Jul 2012, 05:18 PM Reply Like
  • You are, of course, right about the Management! An increase in dividends would be great, though, more likely, another public offering to raise capitol for more ventures, causing people needless panic once again! Capt. JP
    2 Aug 2012, 01:39 AM Reply Like
  • With a two million share sell off, price dropped to 7.44, but bounced right back. 15 million more shares changing hands today than average volume, making four times normal volume today. Several more large blocks later in the day. But buyers picked up the slack. One big holders profit taking is another big buyers bargain price. Down a mere 9 cents as the dust settled. Very strong demand for ARR from my point of view. Swinging from 7.88 to 7.44, and closing in the middle at 7.66 after an extra million shares sold off in the last few minutes seems fairly strong. Look for a possible sell off in the morning, which should be a good buy point. High this morning hasn't been seen since January, 2011. It was a good point for someone to get out, and that will help reduce future resistance.


    There is no good or bad price to get in when the market is climbing in an election year. If one is satisfied with the yield at 15.67%, now is the time. Waiting for a market crash in an election year is an unlikely scenario, and receiving the monthly distributions will likely cover an price drop. At today's closing price, a year's worth of distributions would still make a break even price of 7.66-1.20=6.46. Hopefully that answers your when to buy question. Do even better if you reinvest the distributions. The longer one waits, wishing they had grabbed shares and yield, the more likely one is to miss the boat as more money pours into high yielders. It will be easy to be a shoulda, woulda, coulda instead of an appreciator.
    I hold a substantial position, am up a dollar a share, and enjoying my yield of 17.47%. Same with WHZ, also in the same category of yield. Both have been very good to me.
    31 Jul 2012, 06:26 PM Reply Like
  • Mr. Ellis is right, to a point! If you want to do even better (by appx. 15%) study the charts, particularly near the Xdates. After that judiciously put in a limited offer! In the last three years I have never needed to use a stop loss with ARR! If I had I'd be back $100,000 or more! This stock is absolutely my favorite! Followed closely by AGNC, and I feel my next best friend will be WHZ! Capt. JP.
    2 Aug 2012, 01:27 AM Reply Like
  • <<If you want to do even better (by appx. 15%) study the charts, particularly near the Xdates. After that judiciously put in a limited offer! >>


    Yes, this was the pattern prior to presidential election year combining with huge amounts of money now pouring into the high yielders. I have not found it very helpful lately, especially on monthly payers like ARR. AGNC never paused either. In the past, price would bid up to a high immediately before ex-date, and drop by twice the distribution amount within a few days after ex-date. So, this is still a logical time to buy, but is less sure in the current market conditions than it was for several years in the past. And it may well happen again for any investment after any given distribution. Consider the possibility, but don't depend on it. The other problem with the after ex-date buy is that by the time a cash distribution is available for reinvestment, that momentary window has elapsed.
    After all is said and done, YES! Be vigilant of after ex-date lows as potential buying opportunities. Study the charts. Determine the "normal" number of days before and after for high and low, and be locked and loaded in the stand by position in case opportunity knocks. There is a very distinguishable rise and fall, high and low, directly related to ex-dates. Chart them. Put them on the calendar. Make lists and check them twice. Even if those are less obvious now, they can reappear at any quirk of the market. They are merely harder to discern in an upward climbing market, but very pronounced in a sideways market, as well as a dropping market.


    Also be aware that, at the current elevated price, there is some profit taking going on. Today's above average volume included at least 2 million shares of large block selling -- i.e., a dollar increase in price equals ten months worth of distributions. I do not think there is a better place they can invest, and they are forever giving up the yield based upon their much lower purchase price, but some still view trusts as stocks rather than as tax law dictated yield machines.


    ARR's most recent ex-dates were synonymous with lows. June 13 drop from 7.04 to 6.91 was less than 2%, but more than the dividend if timing was perfect. July 12 drop from 7.34 to 7.21 was again less than 2%, but more than the distribution, and compounded the drop from 7.49 high on the day of the common stock offering announcement. Yet, a mere eight days later it was back to 7.49 and climbing.


    We are currently eight days from ex-date. Eight days before the previous two ex-dates the price was at or below the ex-date price. So it seems that now, before price increases further, offers a price similar to the ex-date low, plus receipt of the distribution. All things subject to change depending on the market conditions. But the best time to buy in a rising market is either now or yesterday.
    2 Aug 2012, 06:01 PM Reply Like
  • Or tomorrow since they are issuing a bunch of new shares.
    2 Aug 2012, 08:12 PM Reply Like
  • A prime example, as I indicated in advance. Though even better was this falloff, which fell on the heels before the prime time to buy! In my opinion now is a prime time to buy! That is unless there is another panic sell-off! It's always best to be able to have funds in reserve to keep buying good stocks as the panicky keep panicing!
    8 Aug 2012, 04:47 AM Reply Like
  • Frankly Frank, Your perfectly right! That's why, for both these, I Judiciously take profits when they are a goodly amount above the dividend, and liberally apply limited offers, in a speculative manner, and don't rely on the pay day. Until today I thought I sold off AGNC too soon (low), but my limited offers caught it well below today, more than making up for the ('loss')! I personally believe AGNC will return 80% before XDay! As will ARR. My pocket book hopes so anyway! Keeping in mind that there are certain Tax ramifications with this method, which doesn't concern 'Me' at present, since I lost two ships to Hurricanes and am still trying to work off over $2Mil. in losses (write-offs), and I re-invest every penny!
    8 Aug 2012, 04:37 AM Reply Like
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