ZagnZig

Annaly Capital Clicking on All Cylinders

May 1: NLY: S&P MAINTAINS BUY RECOMMENDATION ON SHARES OF NLY. Q1 EPS of $0.53 vs. $0.29 tops our $0.47 forecast. Interest rate spread grew 88 bps from a year ago, to 1.46%, and we see further expansion as NLY benefits from recent Fed rate cuts. We remain impressed that NLY has delivered nine straight quarters of EPS expansion in a challenging credit environment, while reducing overall leverage. We continue to look for earnings and dividend growth in '08, on wider spreads and growth at its FIDAC taxable REIT subsidiary. We raise our '08 EPS estimate to $2.40 from $2.24, keep '09 at $2.94, and maintain our $18 target price. NLY yields 11.5%.|