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  • Annaly: Getting Lulled Into A False Sense Of Security [View article]
    RS - I liked your article, but this comment is badly mistaken. In the past, S&L's financed the American Homeowner, but the long and short spreads caused unending financial crises. I doubt you'd argue that we're still in a real estate downtrend. NLY and the REIT world have survived! 2nd, the Fed set out to drive down long term rates and did so for about three months. All the refi's are done! Noone is going to pay even a half a point in fees to save 37 cents a month. That's not to say the fed is thinking about reversing - they want to keep these rates low for the reasons you astutely pointed out.

    NLY has all the tools and experience it needs to make it from here no matter what the Fed or Administration do. While anything is possible, a reasonable person would now conclude a) the worst is over, b) div's may further decline, but not by the discount to book, and c) the business is NOT broken - it's going to be the future of home financing.

    On your Fed sentiments - yes - it was a big problem and was not good, short-term, for NLY, but it was very good for America, very good for the American homeowner (and wannabee), and will be very good for NLY in the long run.
    Jan 3 02:14 PM | 2 Likes Like |Link to Comment
  • mREITs In 2013 - Friend Or Foe To Dividend Payouts? [View article]
    That depends on the economy, and housing is really starting to recover. It will drive GDP in a time of state and municipal austerity, producing a small surge. The fiscal cliff boondoggle will evaporate when the conversation changes and the timid re-find courage.
    Jan 3 12:25 PM | 2 Likes Like |Link to Comment
  • mREITs In 2013 - Friend Or Foe To Dividend Payouts? [View article]
    Because further drops then become anticipated. I know - it's not a very sensible assumption, but that's what makes for opportunity!
    Jan 3 12:23 PM | Likes Like |Link to Comment
  • mREITs In 2013 - Friend Or Foe To Dividend Payouts? [View article]
    Maybe, but look at the dow and nasdaq as of this minute. Straight up, no oscillations at all yet.
    Jan 3 12:20 PM | Likes Like |Link to Comment
  • mREITs In 2013 - Friend Or Foe To Dividend Payouts? [View article]
    Easy, Dude! I'm with you. Use it as an averaging opportunity.
    Jan 3 12:19 PM | Likes Like |Link to Comment
  • mREITs In 2013 - Friend Or Foe To Dividend Payouts? [View article]
    My basis is slightly lower, but in the same ballpark. When you subtract my capital losses from my dividend payouts, I am still well into positive territory. It's hard to convince myself I should have waited, especially is the author is right - that there is a 15% discount to book right now.

    This business is very linear and pure arbitrage. At this point, it is the Fed that has caused compression in the yield spread, and the point of diminishing returns has already passed. I believe that the Fed will be unenthusiastically buying smaller tranches of lower quality than REITs, and the spread for REITs, although compressed, will improve, continuing to produce greater yields than CDs, TBills, or Munis.

    I say this barring a collapse, which, as of yesterday, looks remote.
    Jan 3 12:14 PM | 1 Like Like |Link to Comment
  • In an FAQ about the Sprint (S -1%) deal, Clearwire (CLWR +0.9%) hints the transaction could lead to layoffs. Meanwhile, activist investor Crest Financial, which is staunchly opposed to the deal, says it now owns 8.34% of Clearwire's Class A shares, up from a prior 6.62%. But with shares trading nearly 3% below Sprint's $2.97/share offer price, the Street isn't currently betting on a higher bid arriving. Comcast and Intel say they'll sell to Sprint at $2.97 regardless of whether the deal goes through. (more[View news story]
    I applaud Crest for trying to get a better deal. There's no basis for a lawsuit against them that I can see. It would be judged frivolous. Furthermore, Sprint is not going to let Clearwire go anywhere else.

    While we've seen the arguments that the high frequency spectrum is just not as valuable as 700MHz, I think exactly the opposite is true. Prices of base stations are dropping like rocks as carriers and NEPs try to maintain competitive advantage. You may truly need 7x the base stations at the higher frequencies, but, given Shannons Law, you will have 3.5x the available bandwidth per MHz, and far more clear MHz to use. What this boils down to is: If you want to deliver multi-megabit video quality speed to more than a few users per pop - forget about 700 MHz - it just won't scale - ever!

    That means, the real future lies in >2GHz. Period. There is really no question about this - only negotiating posture. Sure, you need more AP's but they're far less that 1/7th the cost of c.2005 base stations and profound cost reductions are clearly coming. And think about how you can better tailor coverage, particularly in urban environments.

    The future is in high frequency, low cost, WiFi enhanced base stations at >2GHz, and Clearwire currently owns a big chunk of that real estate. All investors are asking for is honesty and a fair deal.
    Dec 19 01:18 PM | 2 Likes Like |Link to Comment
  • Annaly Capital Management (NLY) declares $0.45/share quarterly dividend. For shareholders of record Dec. 28. Payable Jan. 29. Ex-div date Dec. 26. (PR[View news story]
    Date of Record is typically 3 days after Ex - the typical settlement period. Isn;t that right?
    Dec 18 05:33 PM | Likes Like |Link to Comment
  • Sprint's Attempt To Buy Clearwire [View article]
    I'm not sure you understand the economics of spectrum, but ignoring that, pointing out that all these others place little value in CLWR is not very meaningful. If I need a 2" U-bolt in order to recognize $20,000 in revenue on a tower, I'll pay dearly for that U-Bolt, while my neighbor, who either doesn't really need one, or does, but has her own, will not pay so dearly. This is a good analogy for this deal. Sprint, Softbank, maybe Dish, all value CLWR's spectrum. For all the others, it's just an investment, and they saw opportunity costs elsewhere. It's really that simple. And you neglected to remember that MCCaw gets a sweetheart deal on the buyout price. He got cash for whatever arbitrary number Hesse pinned on his equity, and then will get a bump to full price whenever the deal closes.

    The retail stores, however, I agree with you - that was a dumb idea, both then and now.
    Dec 18 11:53 AM | Likes Like |Link to Comment
  • Sprint's Attempt To Buy Clearwire [View article]
    That depends on where you measure the starting point. You choose to measure it at $1.30 or $.83. Others choose to measure it at $17. Somewhere in between is clearly the right place, and apparently, Hesse thinks that place is $2.97. I don't, but I do agree that $2.97 is better than T and VZN laughing their keisters off at Sprint and Softbank for a percentage point or two. These will be the real losers in the larger scheme of things.
    Dec 18 11:41 AM | Likes Like |Link to Comment
  • Sprint's Attempt To Buy Clearwire [View article]
    Bingo! Hesse is a good businessman and has done a lot of really crafty things. Better when your interests are aligned with his!

    That said, he's not dealing with idiots. A fair price level will be achieved or all three (four, really, when you include investors) will lose. Something Hesse may allow to happen, but Son will not.
    Dec 18 11:38 AM | Likes Like |Link to Comment
  • Sprint's Attempt To Buy Clearwire [View article]
    "At this point, Clearwire needs Sprint more than Sprint needs Clearwire" is wrong. When you look at where Sprint and Softbank own spectrum and the technology they use, CDMA, (read Equipment costs and homogenization) you can see that without CLWR's spectrum, Sprint is in a box that it can only get out of by changing technology, a Nextel-like problem, to be sure.

    Clearwire certainly doesn't have many options, that is true, but neither does Sprint, really! The large CLWR holders know this.

    As to Softbank holding firm at $2.97 - yeah right! While Softbank is not as exposed if Sprint loses CLWR, it does miss out on a huge opportunity cost - namely, a crack at being the dominant carrier in the US. $2.97 is a negotiating point and will dissolve under pressure. Why do you think that Sprint recently made the token move from 48% to 50.1% (I'm not asserting those are the real numbers, but you get the point...). There is no way in Hades that Sprint is going to let CLWR get away unless the CLWR investors get stupid.

    My take is that $2.97 is not fairly valuing Clearwire. Clearwire is worth twice that, but if Sprint can make it stick, good for them! I win either way.
    Dec 18 11:33 AM | Likes Like |Link to Comment
  • It would be "an absolute outrage" for Clearwire (CLWR -0.8%) to be sold at Sprint's (S -0.8%) $2.90/share offer price, declares 3.6% activist Clearwire owner Mount Kellett in a letter to the board. To further demonstrate its commitment to fighting for a higher bid, Mount Kellett assigns Clearwire a value of $6.30/share based on some back-of-the-envelope math that values the carrier's spectrum at $18B. Fellow activist investor Crest Financial is also intent on receiving a higher offer. (earlier) (Nov. letter[View news story]
    $2.90 is too low. Apparently Sprint thinks either it's position is defensible, or no others are going to be interested. I think that might be a bit myopic, if true. If that spectrum is truly as valuable as we all think it is, there will be many interested parties that can easily do the deal, liquidate the operation and debt, and have spectrum. The math on that has to be north of $3.
    Dec 14 01:59 PM | Likes Like |Link to Comment
  • Clearwire (CLWR +12.5%) soars to to $3.10 on news of Sprint's (S -1.1%) $2.90/share offer. Wells Fargo views Sprint's initial bid as a starting point for negotiations, and so, apparently, do many others. At $0.17/MHz.-pop, other spectrum deals have involved 50%+ premiums to the implied value of Sprint's offer, the firm notes. Though not 100% comparable, Verizon's cable spectrum purchases cost $0.68/MHz-pop[View news story]
    Didn't some investors pay $17 just a few years ago? $2.90 seems low - way low.

    Not sure I agree with Wells about starting point. If Sprint owns >50% of the shares/BoD seats, who else is going to step in to bid? Also, Management might see this as a slap, but Sprints stock price is equally undervalued, so swapping one for the other might not be seen as a bad thing.

    What to do...
    Dec 13 10:40 AM | 2 Likes Like |Link to Comment
  • Annaly Capital Could Be A Very Risky Investment Now - Stay Away [View article]
    You too, RS. Great article. It stimulates excellent thinking and discussion. I'm sure you would not be sad to ultimately be wrong at all! And if you're right, I'll be the loser, for sure.
    Nov 19 06:11 PM | 1 Like Like |Link to Comment
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187 Comments
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