Annaly Capital - The Slippery Slope Begins [View article]
Third is...
Why would PEG even apply to an REIT, nevermind an mREIT. Good to hear the perspective, but not very credible.
If an investor is looking for growth, then PEG is important and NLY is not and never was the right vehicle. If an investor is looking for income and safety, REITs are usually a very good bet. The fact that the payouts have been fantastic recently due to fed actions is nice, but not something to bank on.
Will the share price drop in the near future? Probably because some growth investors may have bid it up unreasonably. Will it continue to payout at a fantastic yield? Clearly yes.
So the authors advice is good for growth or momentum investors who have been here visiting, but for income investors, just re-read the Market Commentary from the Annaly website.
The FCC Disses The Clearwire Auction [View article]
Spectrum is to wireless what copper is to wired. If you have a shortage of wire the right length, gauge, and price, you will have transmission problems. You're right that there is plenty if spectrum to go around, but it is artificially (and wisely a that) allocated by sovereign nations.
As the nation's demand for more bandwidth increases, and it is increasing, things tend to become depleted. Technology can solve much of the problem, but bandwidth, and therefore, spectrum, is essential. It is the raw material for wireless communications. How it is fabricated by policy and technology enhances it, but it is still prerequisite.
Now, we all know your real issue is Sprint, not Spectrum. I'm going to do a bit of speculating myself and proffer that you're a concerned T or VZN holder, and you should be (concerned). The idea of being beholden to just T and VZN is something one should fight with all their energy - just as one would if it were S and VZN, or whatever.
Dan Hesse has made some spectacular moves since he has been on the job. Most of that goes unrecognized because T and VZN have the lions share of the wealth and the market. However, Sprint has the benefit of agility and not being beholden to the status-quo and that gives them a profound edge in the technology driven world. Son sees this, Eric Prusch sees this, Charlie Ergen sees this. You don't. That's OK - you may ultimately be right! Nonetheless, I'm putting my money on the fact that Sprint+Clearwire+USCel... will provide better coverage, faster speeds, and better service all for a fairer price when all is said and done. And that is why consumers will favor them and they will win, or at least grow much faster than those who will be shrinking.
Annaly: Continuity, Confirmation And Dividends Will Keep This Stock A Solid Buy [View article]
Jonk - The discussion is not about how much they pay themselves. Noone is proposing changing that. It is about transparency.
The proposal is whether they want to spin out a management firm rather than managing internally. It's about moving risk from managers to shareholders. It's about shielding shareholders from data points that they SHOULD HAVE.
I agree with you that I am not unhappy with what management is paid as long as it's aligned with shareholders interests. I disagree that this is any way to go about it. This is a very bad thing for shareholders.
Is management so thin skinned that "fingerpointers" bother them? If so, then I'm doubly concerned!
Annaly: Continuity, Confirmation And Dividends Will Keep This Stock A Solid Buy [View article]
I think you're right, and I disagree. You can choose to use the word 'fingerpointers' or you can note that transparency and honesty go hand in hand. We see time and time again that those who shy away from accountability often go down the wrong path, while those who embrace it simply cannot and do not. (Well, at least their mistakes generally seem more honest and shareholder-serving.)
I don't support this at all and will definitely weigh this heavily in any decision to move my REIT money around. Very heavily. Mike Farrell would probably not have considered such an unfriendly idea. I'm sure Welly can point to the advice of a thousand lawyers to make her case, but I simply don't like it or trust it. End of story.
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]
S was rocked under Forsee, but Hesse has proven to be a man of the internet age, and neither T nor VZN seem to be able to say the same. I think S is in the best position to lower pricing while maintaining superior margins AND customer service. If Softbank brings deep pockets to the party, I would be afraid - very very afraid - if I were in Sprints crosshairs.
Annaly: Continuity, Confirmation And Dividends Will Keep This Stock A Solid Buy [View article]
Thank you, RS.
In a capitalist society such as ours, it is essential that the allocators (us) keep the aggressive tendencies of the managers that we want to be aggressive, in check. Management (Philosophically - not specifically ours) will quickly move to maximize their benefit, and capital allocators must be prepared to keep the situation in balance, or things invariably go off the rails and a good thing for all turns into a bad thing for all. The worst thing that can happen in a capitalist society is that people say "They're making me money - I'll cut them all the slack they ask for." This is a recipe for disaster, in my opinion.
Annaly Capital's Q4 Results Show Decline Rate Slowing [View article]
Tim - They will replace the sold assets with new assets - just like they always do. Don't really understand how you see this as a negative. The market price for such assets has not risen, has it? I think it's dropped to the floor! And even if it does rise, they can only buy what they can buy, right? A bank can only lend it's deposit times it's leverage rate - a product that's fairly steady over time for NLY.
Welly and team are managing masterfully, and while many jumped in at the peak of the 'black swan' and might be feeling lousy, the fact of the matter is NLY offers a great return, has weathered this slim spread period very well, and still beats the pants off virtually any other dividend-paying entity. Heck, my purchases that are two years old are well in the black - and that was the worst time to buy.
As to the $12 to $15 range for the rest of the year - I doubt it will drop much lower than where it closed today. So there we have it - your guess versus mine. Let's see who has to eat their words.
Annaly Capital - The Slippery Slope Begins [View article]
You make a good point. The unit price will be supported by those seeking to make deposits to a yield generating account. As the price drops, the yield rises, until an equilibrium is reached.
That doesn't help the growth investors who piled in when the yield was 20%, but it certainly doesn't hurt anyone else.
MetroPCS (PCS -5.2%) and Leap Wireless (LEAP -3.5%) slide after T-Mobile decides to revive its unlimited data plans. Sprint (S -1.5%) is off slightly. Low-end carriers have clearly decided to challenge market leaders AT&T (T) and Verizon Wireless (VZ, VOD) on price, hoping the latter's de facto price hikes will leave them vulnerable. Will the AT&T/Verizon "duopoly" continue gaining share, or are their latest pricing moves an act of hubris that will backfire? [View news story]
I think T and VZN will indeed be affected, but just like Phillip Morris, they will always have a certain addicted customer and they will savage them.
This is competition! If TMob couldn't afford to do it, they wouldn't. You have to remember that there are no COGS in offering cellphone service. The OPEX is maintenance and billing - administrative functions - and the CAPEX is where all the money goes. It is neither cheap nor easy to build a network and subsidize phones, but that's the business. You have to be smarter about those two things, and only Sprint has shown such smarts. Now everyone is scrambling to be competitive again.
S started this when it rolled out WiMAX as the first 4G service at the same time it made a conscious effort to right it's horrendous customer service record, AND make a push to be environmentally judicious. They are now the lead goose, despite the fact that T and VGZ are bigger. Sprint is setting the pace for the industry.
"This one's on you Ben," writes David Schawel, not blaming the Chairman for the JPM failure, but for creating an environment in which investors (including banks) have no alternative but to seek out risk to get returns. Another example: The explosion in AUM at mortgage REITs which use high leverage to generate returns. "These will blow up at some point." [View news story]
Banks, for millenia, were there to serve the community. The profit motive was the incentive and was secondary. Investors did well - better than the managers - but not obscenely so. There have always been the criminally greedy, but society/government/cus... have generally kept them in check. That is currently not the case and Bernanke has nothing to do with it.
Big banks have sought greater risk since the 80's, cornering unfair advantages and abusing their customers rather than focusing on their cost structures. Maybe one can remove blame from some saying that they need to compete on the same terms others have been allowed to compete, but that's a lame answer. Other banks (or similar entities) will behave consistently with what customers need and will thrive. My Credit Union and Paypal serve me very very well - as a matter of fact, they're all I need. Even commercial entities need to be better served.
Dimon is considered a great bank manager, but he's just been lucky, that's all. Statistics tell us that every spin of the wheel is 50-50, so his reckoning is neither surprising nor interesting.
The TBTF's are experiencing Darwinism at it's best, and I for one am not sad to see it happening, because this is capitalism at it's best.
Sprint (S) CEO Dan Hesse says he still gets "crucified" by investors for his company's deal to carry the iPhone, due to the huge purchase commitments attached, and sees it as evidence of Wall Street's short-sightedness. "There is a disconnect with Wall Street because if you’re building a brand, it does take a long time," he says. But Sprint's board hasn't always agreed with Hesse's vision either. [View news story]
Sprint is focused on the customer since Hesse got there. You've got to give him credit for fixing their image problems. They're also the only one of the big three being innovative in terms of technologies and business models. Third, you have to agree that the Clearwire investment was MUCH smarter than the Nextel deal the idiot before him made (or was it two before?).
I'm a customer AND an investor, and I like Hesse - a lot. I think he makes too much money, but that's an America problem, not a Sprint problem.
Sprint Is Treading An Unsustainable Path [View article]
Sorry Adam, but you don't seem to be as disinterested as you put forth.
1) "Sprint's business model has increasingly hinged more on survival than actual competition." Is that a factual statement, or an emotional one? What data can you offer to support this silly comment?
2) "With a share price near all-time lows and a balance sheet filled with nothing other than red arrows..." Both assertions are incorrect, I don't even have to prove that - anybody can look it up.
3) "The fact that it has reported losses for the last 13 quarters and is on tap to report a further 71% drop in earnings in 2012 isn't too appeasing either." Yes, but you forgot to mention what the 'consensus earnings curve looks like after 2012, where they made a big bet on Apple.
4) "Faced with $1.8 billion in debt maturities due by the end of next year and another $2.6 billion due by 2015, nothing short of a takeover may eliminate the likely bankruptcy filing that lies ahead." What are you saying - that they will not be able to finance their debt? And you know this how?
5) "With Verizon's (VZ) earnings expected to appreciate 15% this year, and AT&T's (T) expected to rise 6%, it appears what few customers Sprint has left are already heading elsewhere." But in fact, the opposite is true. Sprint has more adds as a percentage than either.
6) "Sprint, faces $3 billion in debt maturities coming due in 2015. With the $2.6 billion already owed by Sprint that year, this mountain of debt could come to destroy any chances Sprint has of recovering, that is if it is still in business in 2015." Again, says who? You? Do you realize they bring in $3B a month in revenue? Do you realize that their's is a service model, so their COGS are P&I (mostly)?
7) "but to go out and take a majority stake in December in a company such as Clearwire, which has suffered astronomical losses for years, shows how desperate, and unwise Sprint's management team has become." You really don't understand a thing about the broadband markets. Do you understand about the different LTE frequencies? Do you understand what X MHz of spectrum vs. 3X MHz of spectrum means? Do you understand why the world thinks that 700 is better than 2400, when 2400 is actually far far better? Moffett does.
You really shouldn't be offering investment advice. At least Moffett is able to provide credible arguments, and there are some to be sure. You haven't hit even one. Sorry. I'm sure you're a nice guy, but you really don't know what you're talking about.
Sprint Shareholders: Watch Out Below [View article]
Why is noone considering Verizon? If they scarf up a decent portion of the better spectrum, Sprint is devalued, Dish is less enthusiastic, and Softbank will probably pull out. In any event, only shameless pumping will keep the price up.
I've been long a cheerleader and thank God for Dan Hesse every day, but now I think he made a big mistake by putting in an absurdly low offer for CLWR and then dragging the close out forever. I fear the tiger has now broken the leash and we're sitting in cuckoo city with CE.
Annaly: Continuity, Confirmation And Dividends Will Keep This Stock A Solid Buy [View article]
Look, RS. We both are obviously long, management has just changed, and now we are presented with something that doesn't smell right. And the nonsensical 'supporting arguments' make it scarier.
Everyone refrained from judging Bernie Madoff...until the day came. How can a little light possibly hurt management? How can pushing them to do the right thing be anything but supportive of them?
I think Welly has everyone's best interests in mind, but maybe is a little more 'corporate' than Mike was and is listening to lawyers. That is not always a wise thing to do.
This is a situation where those shareholders who have remained with the team, despite the may who have bolted for slightly higher returns, stand up for their company! This proposal is not in managements best interests either, long term. Let's get them to do the right thing.
Update: Unless, of course, they can provide a sensible and defensible reason that this is in everyone's best interest.
Annaly Capital - The Slippery Slope Begins [View article]
Why would PEG even apply to an REIT, nevermind an mREIT. Good to hear the perspective, but not very credible.
If an investor is looking for growth, then PEG is important and NLY is not and never was the right vehicle. If an investor is looking for income and safety, REITs are usually a very good bet. The fact that the payouts have been fantastic recently due to fed actions is nice, but not something to bank on.
Will the share price drop in the near future? Probably because some growth investors may have bid it up unreasonably. Will it continue to payout at a fantastic yield? Clearly yes.
So the authors advice is good for growth or momentum investors who have been here visiting, but for income investors, just re-read the Market Commentary from the Annaly website.
The FCC Disses The Clearwire Auction [View article]
As the nation's demand for more bandwidth increases, and it is increasing, things tend to become depleted. Technology can solve much of the problem, but bandwidth, and therefore, spectrum, is essential. It is the raw material for wireless communications. How it is fabricated by policy and technology enhances it, but it is still prerequisite.
Now, we all know your real issue is Sprint, not Spectrum. I'm going to do a bit of speculating myself and proffer that you're a concerned T or VZN holder, and you should be (concerned). The idea of being beholden to just T and VZN is something one should fight with all their energy - just as one would if it were S and VZN, or whatever.
Dan Hesse has made some spectacular moves since he has been on the job. Most of that goes unrecognized because T and VZN have the lions share of the wealth and the market. However, Sprint has the benefit of agility and not being beholden to the status-quo and that gives them a profound edge in the technology driven world. Son sees this, Eric Prusch sees this, Charlie Ergen sees this. You don't. That's OK - you may ultimately be right! Nonetheless, I'm putting my money on the fact that Sprint+Clearwire+USCel... will provide better coverage, faster speeds, and better service all for a fairer price when all is said and done. And that is why consumers will favor them and they will win, or at least grow much faster than those who will be shrinking.
Annaly: Continuity, Confirmation And Dividends Will Keep This Stock A Solid Buy [View article]
The proposal is whether they want to spin out a management firm rather than managing internally. It's about moving risk from managers to shareholders. It's about shielding shareholders from data points that they SHOULD HAVE.
I agree with you that I am not unhappy with what management is paid as long as it's aligned with shareholders interests. I disagree that this is any way to go about it. This is a very bad thing for shareholders.
Is management so thin skinned that "fingerpointers" bother them? If so, then I'm doubly concerned!
Annaly: Continuity, Confirmation And Dividends Will Keep This Stock A Solid Buy [View article]
I don't support this at all and will definitely weigh this heavily in any decision to move my REIT money around. Very heavily. Mike Farrell would probably not have considered such an unfriendly idea. I'm sure Welly can point to the advice of a thousand lawyers to make her case, but I simply don't like it or trust it. End of story.
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]
Investors Beware: REIT Yields, Though Sexy, Aren't Telling The Whole Story [View article]
Annaly: Continuity, Confirmation And Dividends Will Keep This Stock A Solid Buy [View article]
In a capitalist society such as ours, it is essential that the allocators (us) keep the aggressive tendencies of the managers that we want to be aggressive, in check. Management (Philosophically - not specifically ours) will quickly move to maximize their benefit, and capital allocators must be prepared to keep the situation in balance, or things invariably go off the rails and a good thing for all turns into a bad thing for all. The worst thing that can happen in a capitalist society is that people say "They're making me money - I'll cut them all the slack they ask for." This is a recipe for disaster, in my opinion.
Annaly Capital's Q4 Results Show Decline Rate Slowing [View article]
Welly and team are managing masterfully, and while many jumped in at the peak of the 'black swan' and might be feeling lousy, the fact of the matter is NLY offers a great return, has weathered this slim spread period very well, and still beats the pants off virtually any other dividend-paying entity. Heck, my purchases that are two years old are well in the black - and that was the worst time to buy.
As to the $12 to $15 range for the rest of the year - I doubt it will drop much lower than where it closed today. So there we have it - your guess versus mine. Let's see who has to eat their words.
Annaly Capital - The Slippery Slope Begins [View article]
That doesn't help the growth investors who piled in when the yield was 20%, but it certainly doesn't hurt anyone else.
MetroPCS (PCS -5.2%) and Leap Wireless (LEAP -3.5%) slide after T-Mobile decides to revive its unlimited data plans. Sprint (S -1.5%) is off slightly. Low-end carriers have clearly decided to challenge market leaders AT&T (T) and Verizon Wireless (VZ, VOD) on price, hoping the latter's de facto price hikes will leave them vulnerable. Will the AT&T/Verizon "duopoly" continue gaining share, or are their latest pricing moves an act of hubris that will backfire? [View news story]
This is competition! If TMob couldn't afford to do it, they wouldn't. You have to remember that there are no COGS in offering cellphone service. The OPEX is maintenance and billing - administrative functions - and the CAPEX is where all the money goes. It is neither cheap nor easy to build a network and subsidize phones, but that's the business. You have to be smarter about those two things, and only Sprint has shown such smarts. Now everyone is scrambling to be competitive again.
S started this when it rolled out WiMAX as the first 4G service at the same time it made a conscious effort to right it's horrendous customer service record, AND make a push to be environmentally judicious. They are now the lead goose, despite the fact that T and VGZ are bigger. Sprint is setting the pace for the industry.
"This one's on you Ben," writes David Schawel, not blaming the Chairman for the JPM failure, but for creating an environment in which investors (including banks) have no alternative but to seek out risk to get returns. Another example: The explosion in AUM at mortgage REITs which use high leverage to generate returns. "These will blow up at some point." [View news story]
Big banks have sought greater risk since the 80's, cornering unfair advantages and abusing their customers rather than focusing on their cost structures. Maybe one can remove blame from some saying that they need to compete on the same terms others have been allowed to compete, but that's a lame answer. Other banks (or similar entities) will behave consistently with what customers need and will thrive. My Credit Union and Paypal serve me very very well - as a matter of fact, they're all I need. Even commercial entities need to be better served.
Dimon is considered a great bank manager, but he's just been lucky, that's all. Statistics tell us that every spin of the wheel is 50-50, so his reckoning is neither surprising nor interesting.
The TBTF's are experiencing Darwinism at it's best, and I for one am not sad to see it happening, because this is capitalism at it's best.
"No alternative but to seek out risk..." please!
Sprint (S) CEO Dan Hesse says he still gets "crucified" by investors for his company's deal to carry the iPhone, due to the huge purchase commitments attached, and sees it as evidence of Wall Street's short-sightedness. "There is a disconnect with Wall Street because if you’re building a brand, it does take a long time," he says. But Sprint's board hasn't always agreed with Hesse's vision either. [View news story]
I'm a customer AND an investor, and I like Hesse - a lot. I think he makes too much money, but that's an America problem, not a Sprint problem.
Sprint Is Treading An Unsustainable Path [View article]
1) "Sprint's business model has increasingly hinged more on survival than actual competition." Is that a factual statement, or an emotional one? What data can you offer to support this silly comment?
2) "With a share price near all-time lows and a balance sheet filled with nothing other than red arrows..." Both assertions are incorrect, I don't even have to prove that - anybody can look it up.
3) "The fact that it has reported losses for the last 13 quarters and is on tap to report a further 71% drop in earnings in 2012 isn't too appeasing either." Yes, but you forgot to mention what the 'consensus earnings curve looks like after 2012, where they made a big bet on Apple.
4) "Faced with $1.8 billion in debt maturities due by the end of next year and another $2.6 billion due by 2015, nothing short of a takeover may eliminate the likely bankruptcy filing that lies ahead." What are you saying - that they will not be able to finance their debt? And you know this how?
5) "With Verizon's (VZ) earnings expected to appreciate 15% this year, and AT&T's (T) expected to rise 6%, it appears what few customers Sprint has left are already heading elsewhere." But in fact, the opposite is true. Sprint has more adds as a percentage than either.
6) "Sprint, faces $3 billion in debt maturities coming due in 2015. With the $2.6 billion already owed by Sprint that year, this mountain of debt could come to destroy any chances Sprint has of recovering, that is if it is still in business in 2015." Again, says who? You? Do you realize they bring in $3B a month in revenue? Do you realize that their's is a service model, so their COGS are P&I (mostly)?
7) "but to go out and take a majority stake in December in a company such as Clearwire, which has suffered astronomical losses for years, shows how desperate, and unwise Sprint's management team has become." You really don't understand a thing about the broadband markets. Do you understand about the different LTE frequencies? Do you understand what X MHz of spectrum vs. 3X MHz of spectrum means? Do you understand why the world thinks that 700 is better than 2400, when 2400 is actually far far better? Moffett does.
You really shouldn't be offering investment advice. At least Moffett is able to provide credible arguments, and there are some to be sure. You haven't hit even one. Sorry. I'm sure you're a nice guy, but you really don't know what you're talking about.
Sprint Shareholders: Watch Out Below [View article]
I've been long a cheerleader and thank God for Dan Hesse every day, but now I think he made a big mistake by putting in an absurdly low offer for CLWR and then dragging the close out forever. I fear the tiger has now broken the leash and we're sitting in cuckoo city with CE.
Annaly: Continuity, Confirmation And Dividends Will Keep This Stock A Solid Buy [View article]
Everyone refrained from judging Bernie Madoff...until the day came. How can a little light possibly hurt management? How can pushing them to do the right thing be anything but supportive of them?
I think Welly has everyone's best interests in mind, but maybe is a little more 'corporate' than Mike was and is listening to lawyers. That is not always a wise thing to do.
This is a situation where those shareholders who have remained with the team, despite the may who have bolted for slightly higher returns, stand up for their company! This proposal is not in managements best interests either, long term. Let's get them to do the right thing.
Update: Unless, of course, they can provide a sensible and defensible reason that this is in everyone's best interest.