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  • More on the Annaly (NLYdowngrade: Morgan's move is part of a larger theme of preferring hybrid mREITs (those buying non-agency MBS) to agency mREITs. The hybrids should benefit from higher non-agency yields and an improving housing market. Upgraded: Invesco (IVR). Downgraded (other than NLY): American Capital (AGNC) and MFA Financial. Everyone's piling into non-agency paper. [View news story]
    There is also the new paradigm that these mREITS are issuing ~8% pfd shares instead of dilutive common. With the common yielding 12-15% on these names, the pfd issuance is accretive and saves the company 4% or more which on $500m issue is over $20m. Partial Offset to decreasing spreads.
    Oct 4, 2012. 02:39 PM | 1 Like Like |Link to Comment
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