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Davidesand

Davidesand
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  • Coping With Mortgage REIT Chaos Part II: Additional Thoughts [View article]
    I agree in that the mReits will continue to provide stellar dividends for the next few years. Even better if the overall economy picks up. The sheep ran for the sidelines.
    Oct 18 12:21 PM | 4 Likes Like |Link to Comment
  • The success of the mortgage REIT industry (both in garnering AUM and providing shareholder returns) is swell, writes Sober Look, but will end as another chapter in the story of leverage. Borrowing short and lending long, the companies are exposed to rising rates and the chance of financing being cut off - threatening not just shareholders, but U.S. mortgage markets. [View news story]
    Like any investment, you must factor in risk versus reward and also the tolerance that you have. In this case, my thoughts are as follows.
    1. The economy is a minimum two years out for any significant recovery. Somewhat shorter if we change presidents and somewhat longer if we don't.

    2. The economy will not turn in a dramatic fashion, but slowly. As it does show signs of life, the Fed will be reluctant to choke it off with a rise in short term borrowing, but wait to see if a substantial recovery is really there.

    3. So 2015 is not out of reason. But when it does, both short term and long term rates will rise together. So some spread will remain for REITs to harvest. The better managed ones will shed current long term debt and secure new debt obligations. So these REITs will remain profitable, though maybe adjusted.

    4. Look, if your return on the dividends drops to 8%, you are still beating out anything else out there for income investors.

    Thoughts anyone, or did I completely miss the mark.
    Sep 11 01:08 PM | 4 Likes Like |Link to Comment
  • AT&T - Investing In The Future But At What Cost? [View article]
    While I am not initiating any new positions in T at this moment, the long view shows that T will continue to successfully sustain and/or grow their position in the telecommunications industry. As with all other tech oriented investments, T must continue to pour capital into upgrades in their delivery of services. Those companies that don't will go the way of Eastman Kodak - which by the way was the original inventor of digital photography. They elected not to push into this product because it would hurt their traditional photographic film business. So with that lesson learned, I am confident in T's long term prospects.
    Dec 12 11:37 AM | 2 Likes Like |Link to Comment
  • AT&T & Verizon: Stifel's Downgrade Creates A Buying Opportunity [View article]
    Long on T. This company has continued to successfully evolve over the last 40 years. As long as the leadership keeps their eye on the ever changing technological landscape, I see nothing but UP.
    Sep 15 08:07 PM | 2 Likes Like |Link to Comment
  • American Capital Agency Is Still A Buy And Hold [View article]
    The street noise over Q1 is deafening, so I added to my position. The company has shown strong leadership and given the lack of a solid recovery, they have negotiated quite a number of "land mines". I think that this is a buying opportunity. Yes, I am long on AGNC
    May 3 12:01 PM | 1 Like Like |Link to Comment
  • After the Boston Fed's Rosengren's call for aggressive QE, out trots the Dallas Fed's Fischer to proclaim the central bank has "done (its) job." Unworried about inflation, he still does not see the need to print more money. The Fed needs to avoid the impression it can solve all of our problems, he argues. [View news story]
    To ascribe the shrinking middle class and a growing disparity between what you might call the rich and the poor to the actions of the Federal Reserve is flawed thinking. It is not the duty of the Fed to monitor sectors of the stock market to determine if any sector may be hyper-inflated. The economic adjustment was due in most part to various congressional leaders pushing the idea that everyone deserves to own their home without regard to the credit worthiness of those people. Freddie Mac and Fannie Mae did what they were instructed to do.

    The second driver is the fact that government grew at an outrageous rate. You may not be aware, but a dollar spent by government only turns 3 times, while a dollar spent by the private sector turns 7. Shifting the economy to a larger government kills productive growth.

    Last but not least is the multi-decade of the baby boomer effect. Unlike their parents who saved and purchased with cash, the boomers were an entire generation of debt accumulation to acquire everything "right now" that they wanted. So downturns were multiplied by this.

    You mention capitalism. We haven't had it for years. With the ever growing socialistic government, we have squeezed capitalism to death. We seek to punish the successful and reward the non-producers. You really ought to read Atlas Shrugged.
    Aug 8 01:10 PM | 1 Like Like |Link to Comment
  • Seniors Deserve Better Advice: Simpler Asset Allocation And Dividend Stocks That Produce Safe Income [View article]
    My KISS model is to select those companies that yield greater than 10% in dividends, have a solid history of dividends, continued growth, and products/services I know. Trying to beat the market at the same time of attempting dividend rewards is folly.
    Jun 30 01:26 PM | 1 Like Like |Link to Comment
  • American Capital's 38.04% Annual Return Continues [View article]
    The analysis is correct. The historic performance, tied to the current management philosophy will continue to realize strong results. Naysayers continue to beat on the mREITS saying that the risk of interest rates rising, Euro issues, and other factors will cause problems in the near future. However, I see a good ride for 18 to 36 months and I am convinces that AGNC leadership will successfully navigate the ever changing landscape, outperforming standard investment stocks.
    I am long on AGNC, NLY,
    David
    Jun 17 10:41 AM | 1 Like Like |Link to Comment
  • AT&T: Never Underestimate The Power Of 'Ma Bell' [View article]
    I too came from the age of "Ma Bell" and have seen the investment pundits predict the demise of the company at various times throughout the company's evolution since the break-up of AT&T. However, though the company had become a behemouth again, the leadership remains nimble within the voice and data sectors, which will do nothing but grow. The profitability and the willingness of the leadership to "share" the profits in terms of decent dividends continue to make this investment attractive, despite the short veiwed naysayers. I am long in T.
    Apr 25 09:33 AM | 1 Like Like |Link to Comment
  • Invest $2,400 In This New High-Yielder And Get About $500 In Dividends Yearly [View article]
    Does anyone have any comments on the underlying risk factor that mReits use leverage and then MORL uses even more leverage on top to multiply dividends? I.e. the leverage on top of leverage?
    Jul 7 09:05 AM | Likes Like |Link to Comment
  • Invest $2,400 In This New High-Yielder And Get About $500 In Dividends Yearly [View article]
    I stand corrected in my comment about the re-balancing of MORL. Thanks to Streakmarine.
    Jul 7 09:02 AM | Likes Like |Link to Comment
  • Invest $2,400 In This New High-Yielder And Get About $500 In Dividends Yearly [View article]
    I would suggest that everyone really research the risks with this type of mechanism. Since it is re-balanced daily, the NAV can plummet in a disastrous manner. Also, the idea of 2X the returns of dividends paid by the underlying securities indicates extreme risk. See the following: http://bit.ly/14iYif4


    If it is too good to be true, Guess what.
    Jun 30 09:10 AM | Likes Like |Link to Comment
  • SoftBank's (SFTBF.PK) history suggests an acquisition of Sprint (S -1%) would mean big things for the U.S. mobile industry, notes Tero Kuittinen. Thanks to aggressive pricing, SoftBank managed to turn an also-ran Japanese carrier (the former Vodafone Japan) into the market's subscriber add leader shortly after acquiring it in '06, and has kept its lead since. Should AT&T (T) and Verizon (VZ), who seem happy to maintain premium pricing, be worried? (more[View news story]
    Sprint for a number of years has been an "also ran" with it's terrible aqcuisition of Nextel, the inability to merge the systems, and overall poor quality. So what if it is acquired by SoftBank; are they going to take it further down the road of eroding margins while trying to improve service and quality. I think not.

    It's the old three legged seat issue. All any company has to offer, in simplistic terms, is price, quality, and service. No company has ever been able to offer all three simultaneously. Don't know about the Japanese, but users here will pay a premium for better service and better quality (nee new offerings in hardware and software). Don't see Sprint able to to that.

    I'm long on T...
    Oct 12 05:12 PM | Likes Like |Link to Comment
  • The Future Price Of American Capital Agency [View article]
    In my humble opinion, the valuation of mREITS is similar to how other stocks are valued. Even with all the technical analysis, valuation comes from three factors. They are fear, greed, and hope. So the best one can do is look at the total return, but factor the dividends paid out as the basis for investment. If you are satisfied with 13% to 14% dividend returns and that you believe the management of these mREITS is solid and understands that they must perform in changing economic environment, then stay long. Where else with the undeserved run up of valuations (e.g. Apple) can you make that kind of return in the market. Keep in mind that the total average return from the stock market over the last 80 years has been 9.4%. While that is a really long view, in my mind it gauges how well my personal management of investments have been. I appreciate all the data and views that each of you has provided.

    I am long on AGNC
    Aug 8 08:40 AM | Likes Like |Link to Comment
  • Avoid This Underperforming Telecom Now [View article]
    I agree that the merger of Sprint and Nextel was a disaster. Other than for push-to-talk, the iDEN technology is woefully inept at voice and other data communications. If Sprint is able to successfully move the PTT over to CSMA - LTE technology they may still stay viable in the business market that needs PTT for operations. However this migration will not occur until 2013 and not be complete until 2014. For investors that is a big bet.
    I have no position in Sprint nor will initiate one
    Jun 7 08:38 AM | Likes Like |Link to Comment
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