UBS ETRACS Monthly Pay 2x Leveraged Mortgage REIT ETN (MORL) - NYSEARCA
  • Nov. 4, 2015, 7:01 AM
    | Nov. 4, 2015, 7:01 AM | 6 Comments
  • Jul. 28, 2015, 9:52 AM
    • Investors take a least a small hiatus from selling the mortgage REITs after last night's clunker of an earnings report from American Capital Agency (AGNC +2%).
    • Book value fell by 6% during Q2, with higher rates, widening MBS spreads, and faster prepayments making for an ugly combination.
    • The company, however, entered Q3 with its lowest leverage since the financial crisis, giving it the firepower to buy assets on the cheap. At the close yesterday, the stock was selling for a 22% discount to June 30 book value. At some point, the bad news is priced in?
    • The earnings call is set for 11 ET.
    • Annaly Capital (NLY +1.6%), CYS Investments (CYS +0.8%), Western Asset (WMC +1.2%), New York Mortgage (NYMT +0.5%).
    | Jul. 28, 2015, 9:52 AM | 13 Comments
  • Feb. 26, 2014, 10:20 AM
    • In sharp contrast to the views at American Capital (AGNC +0.5%), Annaly (NLY +3.2%) CEO Wellington Denehan-Norris - speaking on the earnings call - says it makes more sense to lever up and directly buy mortgage-related assets than repurchasing shares or buying the stock of other mREITs.
    • Why rely on the management of other companies, says Norris, reminding of the 1998-99 period - another time when mREITs traded well below book value. After the collapse in Russia, it was found one "darling" in the mortgage REIT industry (no longer in business today) owned the debt of that country.
    • Satisfied with hedges currently in place, Annaly doesn't plan to add any more as it buys more MBS. After taking down leverage to 5:1 over the past year, the company is looking to bring it back towards 7:1.
    • On the growing commercial side of the business, Annaly is in talks with an originator of commercial mortgages for direct access to its assets.
    • Noting the recent sluggish economic stats, particularly as they relate to housing, management doesn't feel like the Fed will soon be in any position to tighten policy.
    • Presentation slides
    • Previous earnings coverage
    • Related ETFs: REM, MORT, MORL
    | Feb. 26, 2014, 10:20 AM | 11 Comments
  • Feb. 4, 2014, 11:18 AM
    • "There are numerous reasons to believe a repeat of 2013 is not in the cards," says American Capital Agency (AGNC +2.2%) CIO Gary Kain on the earnings call. He notes most traditional agency MBS investors are underweight the sector, and MBS have already priced in continued rises in interest rates.
    • Not only is American Capital aggressively repurchasing its own stock while it trades at a large discount to book value, but it bought $400M worth of other agency mREIT players ($237M in Q4, increased to $400M as of the end of January). Kain: Why buy more mortgages when you can buy the companies that own them for roughly 20% less than the value of the mortgages on their books.
    • Earnings call slides
    • Previous earnings coverage
    • Related ETFs: REM, MORT, MORL
    | Feb. 4, 2014, 11:18 AM | 28 Comments
  • Jan. 30, 2014, 10:20 AM
    • You're seeing a lot of demand in the assets we hold, says Capstead Mortgage (CMO +1.5%) management on the conference call after reporting a blowout Q4. In a steepening yield curve environment - the short-end anchored while long rates move higher - Capstead is benefitting from tightening spreads in the 5/1 ARMs it mostly holds.
    • Mr. Market seems to have fleshed this out, and Capstead was already trading for right around book value (reported at $12.47 as of Dec. 31) vs. the double-digit discounts for long-end players like Annaly (NLY +0.2%), American Capital (AGNC -0.3%), Armour (ARR), and CYS Investments (CYS -0.5%).
    • Another in the adjustable-rate arena is Hatteras Financial (HTS +1.5%).
    • Related ETFs: REM, MORT, MORL
    | Jan. 30, 2014, 10:20 AM | 3 Comments
  • Nov. 7, 2013, 11:10 AM
    • We get it ... you're not a fan of the Fed. The rambling Annaly (NLY -4%) conference call is an exercise for management (and some of the questioners) to complain about the distortions caused by Fed policy and how mortgage markets may blow up as that policy is reversed.
    • QE3 is the equivalent of a new $6B mortgage REIT with 6x leverage being formed every month, says CEO Wellington Denehan, who also notes these new mortgage REITs are uneconomic buyers.
    • Available later on SA, the transcript should be an interesting read as Denehan and her team muse about the process of trying to figure out this market.
    • In the meantime, Annaly shares reprice themselves for what looks to be another dividend cut (payout was $0.35 per share last quarter). The current price of $11.11 per share is a 12.5% discount to September 30 book value of $12.70 - seems about inline compared to much of the rest of the mREIT (REM -0.8%) sector.
    • Q3 earnings coverage.
    • Q3 presentation slides.
    • Related ETFs: MORT, MORL.
    | Nov. 7, 2013, 11:10 AM | 5 Comments
  • Aug. 8, 2013, 8:42 AM
    • Net income per share of $0.71 does not reflect $0.22 per share of negative valuation adjustments that should be realized in Q3. Book value per share of $14.69 up 1% from Q1, up 22.4% from a year ago.
    • Earnings call at 5 ET. Q2 results. (PR)
    • RWT's quarterly Redwood Review is a must-read for any mortgage investor (REM, MORT, MORL). From the opening letter: "It's too early to say the worst of the recent market disruptions are behind us, but it does appear that the agency and non-agency RMBS markets are firming somewhat. We are beginning to see spread premiums on AAA RMBS stabilize."
    | Aug. 8, 2013, 8:42 AM
  • Oct. 26, 2012, 3:59 PM

    Add Anworth Mortgage (ANH) to those mREITs planning on decreasing leverage as the Fed bids up the prices of MBS. CEO Joe McAdams says he plans on selling high those assets most vulnerable should the Fed "hint" at an end to QE. The move may mean a continuation of the $0.15 dividend for awhile longer even as rate spreads continue to narrow. The flip side, of course, may be a reduction in the current $7.45 book value. (PR)

    | Oct. 26, 2012, 3:59 PM
MORL Description
The ETRACS Monthly Pay 2xLeveraged Mortgage REIT ETN (NYSE: MORL) ("MORL" or the "ETN") is an exchange-traded note linked to the monthly compounded 2x leveraged performance of the Market Vectors® Global Mortgage REITs Index (the "Index"), reduced by the Accrued Fees. MORL is listed on the NYSE Arca exchange, is denominated in USD, and pays a USD-denominated variable monthly coupon linked to 2 times the cash distributions, if any, on the Index constituents, less any withholding taxes.
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