Oct. 29, 2014, 4:20 PM
- Q3 net spread and dollar roll income of $0.68 per share vs. $0.72 in Q2. Dividend of $0.65.
- Book value per share of $22.24 down 2.2% from the end of Q2. Today's close of $19.75 is an 11.2% discount to book.
- Combining dividend with the decline in book value yields a 0.7% economic return on equity for quarter, or 2.8% annualized.
- $6.4B portfolio consists of $4.3B in agency securities, $900M net long TBA mortgage position, $1.1B non-agency securities, $100M in MSRs. CPR on agency paper of 8.9% up 60 basis points from Q2.
- Net interest spread of 2.34% up two basis points from Q2.
- No shares repurchased during quarter. $134.9M remains authorized and the timeline has been extended through the end of next year.
- Conference call tomorrow at 11 ET
- Previously: American Capital Mortgage EPS in-line, misses on revenue
- MTGE flat AH
Oct. 29, 2014, 4:04 PM| Comment!
Oct. 13, 2014, 4:19 PM
- Both equity and mortgage REITs saw plenty of buying as nearly all of the rest of the market was lit up bright red, and Treasury ETFs signaled a sharp drop in yields when government bonds reopen for trade tomorrow (closed this session for Columbus Day).
- A sampling of equity names: Senior Housing Properties (SNH +1.2%), Medical Properties Trust (MPW +1.4%), Gramercy Property Trust (GPT +1.7%), Equity Residential (EQR +0.7%), Inland Real Estate (IRC +0.9%), Sovran Self Storage (SSS +1.1%), Highwoods Properties Trust (HIW +1%).
- One equity REIT sector in the red along with the rest of the market is lodging amid worsening Ebola fears: Ashford Hospitality Trust (AHT -2.9%), Sunshine Hotel Investors (SHO -1.4%), LaSalle Hotel Properties (LHO -1.5%), Summit Hotel Properties (INN -1.5%).
- Mortgage REITs: American Capital Agency (AGNC +1.4%), CYS Investments (CYS +2.2%), Invesco (IVR +1.1%), American Capital Mortgage (MTGE +1.5%), Western Asset (WMC +1.1%).
- ETFs: IYR, VNQ, REM, MORL, MORT, DRN, URE, REZ, SRS, RWR, SCHH, ICF, ROOF, DRV, KBWY, RTL, REK, FRI, FTY, PSR, IFNA, FNIO, WREI
Oct. 1, 2014, 3:02 PM
- Despite a strong period for mortgage REITs ever since the financial crisis, most of the benefits from structural changes to the mortgage market have yet to be realized, says American Capital Agency (AGNC +1.8%) and American Capital Mortgage (MTGE +0.8%) CIO Gary Kain, wrapping up his company's Mortgage REIT day with a look at the future.
- Presentation slides
- Why is this? First, Fed MBS purchases have dwarfed the declines in GSE portfolios; second, the GSEs/FHA still account for the vast majority of new originations; third new non-agency securitization volumes are negligible; fourth GSE credit risk transfers are only beginning to ramp up.
- At some point, there's going to be greater reliance on private capital, says Kain, and he and his team believe it's going to provide significant opportunity in the mREIT (REM +0.6%) space in the intermediate to longer term in the agency, non-agency, and MSR sectors.
- Previous coverage
Oct. 1, 2014, 9:20 AM
- American Capital Agency (NASDAQ:AGNC) and American Capital Mortgage (NASDAQ:MTGE) CIO Gary Kain is set to launch the all-day proceedings in a few minutes.
- Link to webcast and presentations
- Noted in Kain's slides are the fast pace of share repurchases at the two companies amid the large discount between price and book value which opened up last year. AGNC bought back 10% of its stock in 2013, far more than the majority of its agency REIT peer group. MTGE repurchased 13% of its float in 2013, also several orders of magnitude larger than much of its non-agency REIT peer group.
Sep. 19, 2014, 3:32 PM
- Leading the mREIT sector (REM +0.2%) higher this session are American Capital Agency (AGNC +1.9%) and American Capital Mortgage (MTGE +1%) after the two maintained their $0.65 per share quarterly payout last night. Neither move should have been a surprise as both comfortably out-earned their dividend last quarter.
- Also maintaining its payout ($0.30 per shares) after the bell yesterday was Annaly Capital (NLY +0.8%).
- The sector is also getting a break from rising rates with the 10-year Treasury yield lower by four basis points to 2.58%
- ETFs: MORT, MORL
Sep. 18, 2014, 5:39 PM| 2 Comments
Aug. 1, 2014, 11:40 AM
- "We think that MTGE's allocation of equity to agency MBS, non-agency MBS and mortgage servicing will prove capable of driving Y/Y earnings gains even as the FOMC engages in liftoff," says analyst Merrill Ross, lifting his price target by $1 to $22.50.
- MTGE's liquid portfolio can take advantage of mis-priced assets opportunistically, says Ross, and negative net supply of MBS will be supportive of its holdings.
- Previously: American Capital Mortgage still on sale after big quarter
Jul. 30, 2014, 4:28 PM
- Q2 net spread and dollar roll income of $0.72 vs. $0.62 in Q1. Dividend is $0.65.
- Book value per share of $22.73 up 4.4% from the end of Q1. Today's close of $19.85 is a 12.7% discount to book.
- Adding dividend and book value increase together yields a 7.3% economic return for the quarter.
- $6.8B investment portfolio includes $4.5B in agency MBS, $1.2B net long TBA mortgage position, and $1.1B in non-agency MBS. $68M investment in MSRs during Q2. $11M investment in common stock of other mREITs during Q2. Leverage slips to 5.2x from 5.6x.
- CPR for agency portfolio of 8.3% up from 5.7% in Q1.
- Average net interest spread during Q of 2.32% up 13 bps from Q1.
- Conference call tomorrow at 11 ET
- Previously: American Capital Mortgage EPS of $1.64
- MTGE flat AH
Jul. 30, 2014, 4:24 PM
Jul. 17, 2014, 7:09 AM
- American Capital Agency (NASDAQ:AGNC) and American Capital Mortgage (NASDAQ:MTGE) as of yesterday disclose a 4.53% stake in Hatteras Financial (NYSE:HTS) vs. their combined 8.5% stake from late January.
- AGNC and MTGE CIO Gary Kain - late last year and early this year noting the absurdity of large swaths of the mREIT industry trading at sizable discounts to book value - was an aggressive buyer of his own stock and that of other mortgage REITs (though Hatteras was the only publicly disclosed purchase).
- Not including sizable dividends, Hatteras has returned about 20% YTD, as has American Capital Agency. American Capital Mortgage is up about 12.5%.
Jul. 3, 2014, 9:56 AM
- A few days ago, the 10-year Treasury yield stood at about 2.50%, but it's been on the rise all week and shot up to near 2.7% this morning following the strong jobs print and drop in unemployment to 6.1%. Checking the short end of the curve, Eurodollar futures are selling off as well, and now have baked in more than one rate hike between now and one year from now, and 75 basis points of hikes by the end of 2015.
- Previously: Treasury yields jump, gold slumps after strong jobs print
- Off 1.1% today, Annaly Capital (NLY) is down nearly 5% since this time last week, with a similar move having taken place in American Capital Agency (AGNC -1.2%).
- Chimera (CIM -1.4%), CYS Investments (CYS -1%), Invesco Mortgage (IVR -1.8%), American Capital Mortgage (MTGE -1.6%), New York Mortgage Trust (NYMT -1.2%), AG Mortgage (MITT -1.8%), Ellington Residential (EARN -0.7%), Dynex (DX -0.8%), MFA Financial (MFA -0.9%).
- ETFs: REM, MORT, MORL
Jun. 26, 2014, 3:54 PM
- Enjoying the decline in interest rates even among some hawkish stomping of feet by St. Louis Fed boss Jim Bullard, the mortgage REIT sector (REM +0.9%) is broadly higher. Sector giants: Annaly Capital (NLY +0.6%) and American Capital Agency (AGNC +1.1%).
- Others: Two Harbors (TWO +1.9%), Chimera (CIM +1.8%), American Capital Mortgage (MTGE +1%), Cherry Hill Mortgage (CHMI +1.4%), New York Mortgage Trust (NYMT +1.1%).
- Other ETFs: MORT, MORL
Jun. 17, 2014, 4:18 PM| Comment!
May 15, 2014, 6:56 AM
- It sounds like it could be a valuation call by JMP's Steven Delaney as the rise in book value in Q1 didn't match the quick gain in the stock price. Shares still trade at a discount to book (last night's $19.92 close is an 8.3% discount to March 31 book of $21.78), but the no-brainer part of the trade may be over.
- It's may also be notable that management - an aggressive buyer of company stock late last year - brought share repurchases to a near-halt in Q1.
- MTGE no trades premarket
Apr. 30, 2014, 4:49 PM
- Net income of $48.8M or $0.95 per share, with spread and dollar roll (core) income of $0.62 missing estimates by $0.02 and coming against the quarter's $0.65 dividend. $9.2M of operating income from Residential Credit Solutions (MSR business). As of the end of the quarter, company has about $37.3M, or $0.73 per share in estimated undistributed taxable income.
- Book value per share of $21.78 up from $21.47 at the end of last year after including $0.65 payout. 4.5% economic return from the $0.65 dividend and $0.31 per share increase in book value.
- Investment portfolio of $5B agency MBS, $700M of net long TBA securities, $1B of non-agency MBS, and $41.3M of investments in agency mortgage REITs.
- CPR on agency portfolio of 5.7% about the same as Q4. Net interest spread of 2.23% slips 7 bps from Q4.
- Buybacks fizzle to a near-halt: 200K shares or 0.4% of the float repurchased during quarter at average price of $19.67 each.
- CC tomorrow at 11 ET
- Source: Press Release
- Previously: American Capital Mortgage beats by $0.29, misses on revenue
- MTGE +0.4% AH
MTGE vs. ETF Alternatives
American Capital Mortgage Investment Corp operates as a REIT. It invests in, finance and manage a leveraged portfolio of mortgage-related investment, non-agency mortgage investments and other mortgage-related investments.
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