How will Newcastle's (NCT) spinoff of New Residential (ticker: NRZ) unlock value (presentation)?...

How will Newcastle's (NCT) spinoff of New Residential (ticker: NRZ) unlock value (presentation)? Newcastle's stock yielded an average 12% in 2012, while peers with comparable portfolios to NRZ yield about 7%. Those with portfolios close to the new Newcastle also have far lower yields. It's yahtzee for NCT and NRZ owners should these yields converge. The spinoff is expected by the end of Q1.

Comments (4)
  • Michael Bryant
    , contributor
    Comments (6932) | Send Message
    Well, many spin-offs turn profitable to shareholders. Theory is that value can be better understood as separate concentrated entities.
    13 Feb 2013, 01:03 PM Reply Like
    , contributor
    Comments (6328) | Send Message
    Where does the article get a yield 'average' of 12 % for 2012? On yesterday's close , the $.84 dividends was 7.72% Who writes this stuff?
    14 Feb 2013, 02:59 PM Reply Like
  • SA Editor Stephen Alpher
    , contributor
    Comments (562) | Send Message
    Yes, average.


    Shares were at about $5.50 at start of year w/$0.20 dividend, a 14.5% yield. They were $6.50 mid-year, 12.3% yield. They were $8.46 at year's end w/$0.22 dividend, a 10.4% yield.


    I'd say the company saying it had an average 12% yield in 2012 is right on target.
    14 Feb 2013, 04:50 PM Reply Like
  • roxbury69
    , contributor
    Comments (4) | Send Message
    i am an investor in reits


    when nct spins off nrz will they give 1 share for every share of nct
    16 Mar 2013, 06:10 AM Reply Like
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