AGNC Investment Corp.NASDAQ
Fri, Dec. 2, 7:31 AM
- The risk/reward on AGNC Investment (NASDAQ:AGNC) is no longer compelling at current levels," says Douglas Harter, downgrading to Neutral from Outperform, and cutting the price target to $19.50 from $21 (last night's close $18.09).
- He expects a whopping 7.8% decline in book value through November (to be announced on Dec. 12). This comes against his forecast of a 2.6% decrease in book value for the sector (NYSEARCA:REM) as a whole, and flat economic return (defined as the change in book value plus the dividend) for Q4.
- As far as AGNC's relative valuation at the moment, it trades for 91% of tangible book vs. just 84% for fellow sector giant Annaly Capital (NYSE:NLY). The sector as a whole trades at 91% of book. He's also cutting Annaly's PT to $11 from $11.50, along with CYS Investment (NYSE:CYS) to $8.50 from $9. Chimera Investment (NYSE:CIM), however, gets its PT boosted to $17 from $15.50 to reflect strong incremental returns.
- Harter and team's top picks remain those names with less exposure to interest rate risk, better historical track records, and lower book value volatility: Two Harbors (NYSE:TWO), New Residential (NYSE:NRZ), PennyMac (NYSE:PMT), and Starwood (NYSE:STWD).
Thu, Dec. 1, 5:37 PM
Tue, Nov. 29, 2:31 PM
- Though lagging the S&P 500 by about 100 basis points since the election (and the banks by a mile), the mortgage REITs are nevertheless higher since the election despite the sharp rise in interest rates.
- Mortgage REITs are carry players, of course, and can expect to see boosts to income if long rates rise faster than short rates (though book value could take a hit).
- The iShares FTSE Nareit Mortgage REIT ETF (REM +1.2%) today is outperforming the S&P 500's 0.35% advance. The 10-year Treasury yield is down five basis points to 2.30%.
- Annaly (NLY +1%), AGNC Investment (AGNC +1.7%), Two Harbors (TWO +2.9%), Chimera (CIM +2.1%), CYS Investments (CYS +2%), Invesco (IVR +1.5%), Capstead (CMO +1.5%), Western Asset (WMC +1.5%), AG Mortgage (MITT +2.7%)
- ETFs: MORT, MORL
Mon, Nov. 14, 4:39 PM
Mon, Nov. 14, 4:08 PM
- Alongside declaration of its $0.18 monthly dividend, AGNC Investment announces Oct. 31 book value per share of $22.63 and estimated net tangible book value per share of $20.95 (tangible book excludes intangible assets on the books as part of the purchase of the management company). AGNC closed today at $19.08.
- Thirty days earlier, BVPS was $22.91 and TBVPS was $21.23.
Thu, Oct. 27, 10:42 AM
- The 10-year Treasury yield is making new bear-cycle highs today, up another seven basis points to 1.86% - its perkiest level since May. The move up in yields is global, with U.K. 10-years up 11 bps and Germany's up 8.5 bps.
- Earlier today, the U.K. reported Q3 GDP growth of 0.5% - far better than what had been predicted post-Brexit.
- Facing at least a little more competition in the yield department, equity REITs have turned sharply lower, with VNQ down 2.1%, and IYR off 1.8%. Mortgage REITs (REM -0.6%) are faring a little better as solid Q3 earnings begin to roll in.
- The major U.S. averages have given up early gains and turned red, led by the S&P 500 and Nasdaq, both off 0.25%.
- Individual equity REITs: Verreit (VER -2.2%), Welltower (HCN -2.4%), Equity Residential (EQR -1.6%), Omega Healthcare (OHI -3.2%), Simon Property (SPG -3.2%), General Growth (GGP -2.6%), Public Storage (PSA -2.9%), Gramercy Property (GPT -1.9%), Washington Real Estate (WRE -1.2%), Hersha (HT -2.9%), Sunstone Hotel (SHO -1.4%), Stag Industrial (STAG -2%)
- Mortgage REITs: AGNC Investment (AGNC -1.5%), Annaly (NLY -0.7%), Two Harbors (TWO -0.4%), Capstead (CMO +0.3%)
- ETFs: VNQ, IYR, MORL, REM, MORT, DRN, RQI, URE, SCHH, ICF, RWR, SRS, RNP, RFI, JRS, KBWY, NRO, DRV, RIT, RIF, REK, DRA, FRI, FTY, FREL, LRET, PSR, WREI, XLRE, IARAX, RORE
Mon, Oct. 24, 4:11 PM
- Q3 net spread and dollar roll income of $0.64 per share vs. $0.56 earned in Q2. Dividends of $0.56 during quarter.
- Net book value per share of $22.91 up from $22.22 three months earlier. Today's close of $19.84 is a 13.4% discount to Sept. 30 book. Tangible book value per share of $21.23 excludes $1.68 of goodwill and other intangible assets recognized as part of the company's purchase of its management company.
- Economic return for the quarter of 5.6%, or 22.4% annualized.
- CIO Gary Kain notes the quarter's strong performance was boosted by the recent internalization of management, which meant a big cut in operating expenses.
- Previously: AGNC Investment beats by $0.09 (Oct. 24)
- AGNC +1.5% in thin after hours trading.
Mon, Oct. 24, 4:02 PM
Sun, Oct. 23, 5:35 PM
Wed, Oct. 12, 4:28 PM
Tue, Oct. 4, 4:20 PM
- With the "American Capital" moniker no longer necessary following this summer's internalization of management, American Capital Agency (NASDAQ:AGNC) this week began operating as AGNC Investment Corp.
- Likewise, American Capital Mortgage (NASDAQ:MTGE) changed its name to MTGE Investment Corp.
- The stock symbols remain the same.
Mon, Sep. 26, 3:26 PM
- A 1.55% decline in Europe amid worries over the financial condition of Deutsche Bank has helped send the U.S. averages lower by 0.85%, and Treasury yields to their slimmest this month. At the short end, traders are cutting bets on the chance of a rate hike at any point in 2016.
- Fading that negative action are the REITs, with the Vanguard REIT Index Fund (NYSEARCA:VNQ) higher by 0.3% and the iShares U.S. Real Estate ETF (NYSEARCA:IYR) up 0.2%. The iShares Mortgage REIT ETF (NYSEARCA:REM) is also up 0.2%.
- Among individual issues: Annaly Capital (NLY +0.8%), American Capital Agency (AGNC +0.7%), Realty Income (O +1.1%), Omega Healthcare (OHI +1%), HCP (HCP +0.8%), Aimco (AIV +1.7%), Simon Property (SPG +0.5%), Kimco (KIM +0.8%), Public Storage (PSA +0.9%), Stag Industrial (STAG +0.5%)
Wed, Sep. 14, 4:12 PM
Wed, Sep. 14, 4:09 PM
- Alongside declaration of its $0.18 monthly dividend, American Capital Agency (NASDAQ:AGNC) announces Aug. 31 book value per share of $22.71 and tangible book value per share of $21.01.
- Tangible book excluded estimates of intangible assets acquired as part of the internalization of management.
- Book value per share was $22.24 on July 31.
- Today's close of $19.30 is a 15% discount to book; an 8% discount to tangible book.
Wed, Aug. 17, 10:48 AM
- July 31 book value per share of $22.24 is up $0.02 from one month earlier. This includes deductions for not just July's $0.20 dividend, but August's $0.18 payout which was declared on July 27. Adding that $0.18 back in means book value gained $0.20 per share during July.
- Estimated tangible book value per share (after adding in the August payment) is $20.72.
- AGNC is lower by 0.8% this morning to $19.55.
Thu, Jul. 28, 2:27 PM
- The deal for American Capital Agency (AGNC +0.6%) to internalize management closed on July 1, and AGNC now provides management to American Capital Mortgage (MTGE +0.9%), giving it a stream of management income.
- Annual run-rate operating costs should be below 0.9% of shareholder equity - or below 0.75% if adding in the management fee from MTGE.
- This would be the lowest cost structure of any mortgage REIT, and well below the average of 2.91% (measured against shareholder equity).
- See presentation slides (now hosted on Seeking Alpha).
- Previously: Strong quarter for American Capital Agency (July 27)
- Previously: American Capital Agency declares $0.18 dividend (July 27)