Seeking Alpha


Send Message
View as an RSS Feed
View worldbank's Comments BY TICKER:
Latest  |  Highest rated
  • Slow Rate Increases Are Right Up Annaly's Alley [View article]
    PM101- thank you for the article. I do believe that you and bd- have it correct..the need for slowly rising rates. However, I disagree with your conclusion "recent data shows the rate of household formation increased 24% last month, which is a leading indicator for future home purchasing activity". Future home purchasing is just not going to materialize in a big way because the income levels of "families" are weak, even as two may be working, causing a BIG problem with saving for down payments. Further, many "NEW" families do not want a house after witnessing the last 8 years. Please view US Rental Vacancy rate charts as the vacancy rate in 2008 & 2009 was in the 10% range. As at 12/31/2014 the rate is ~7% ( Thus, I believe that mReits WILL have problems deploying future funds into conventional home mortgages which will cause downward pressure on cash flows without help from commercial loans and/or increased leverage. Nice to see NLY has moved into better spread situations thru commercial portfolio.
    Apr 13, 2015. 09:42 PM | Likes Like |Link to Comment
  • Annaly Capital: Why FBR Capital's Annaly Downgrade Is Misguided [View article]
    I agree that FBR Capital is a tad late on downgrade. However, my take on the DOWNGRADE by FBR Capital is that they think, based upon the hedges in place, NLY cannot continue to "earn" the $1.20 annual dividend, not that NLY book value may drop 50 cents. If NLY can "earn" 30 cents per Q I think stock price stays @ ~$10.50. I believe stock price will follow payout, up/down/flat depending upon actual/perceived pay out.
    Apr 9, 2015. 04:08 PM | 2 Likes Like |Link to Comment
  • Want An Energy Company With High Profits Right Now? Check Out Valero [View article]
    WNR operates but two refineries in Texas, a trucking operation, pipeline/storage and asphalt plants. Not to be confused with VLO as to size and scope of operations as well as capitalization. My thought would be to tip toe into others under the concept that a $11+ spread causes all to benefit due to "rising tide".
    Mar 24, 2015. 10:58 AM | Likes Like |Link to Comment
  • Want An Energy Company With High Profits Right Now? Check Out Valero [View article]
    >>>It's all about the spread and right now it's $11.00 + verses historical $5.00+. How does VLO not BLOW OUT estimates in a big way?? I just don't see a pullback in earnings and your suggestion of $3.6B to $2.8B as "modest drop", it's a 22% drop! If someone cut your annual salary 22% would you call it modest?? Just LUV the VLO.
    Mar 20, 2015. 05:21 PM | 3 Likes Like |Link to Comment
  • I Want Book Value: Annaly's Weakness Is Not The Dividend [View article]
    I'm in the dividend camp chart. Simply stated: Price is at $16, yield is 10%+, price is @ $11 yield is 10%+. dividend is flat, so to the stock price. I really think yield dictates price as most investors do follow the yields. Spread is narrowing, dividend is dropping, price is falling; spread is expanding, price rises as dividend expands. However, that said, I believe that book value is a very very useful tool for management. I would encourage management to BUY stock @ 80%-90% of book as it's a current investment yielding 10%+ which can be replaced, via a new issue, at a later date @100%+. BUYBACKS make a lot of financial sense for the company and its owners. As noted above, management in the past was quick to issue stock @ ~120% of book, >>>now they need to be just as nimble by doing a tender or buyback/s when stock is ~20% below book. I mean this is an ~ 40% spread or as an example, something like $4.00 + per share of FREE equity in total between 120% above and 80% below book. Simply stated, it's like a new issue that sold @ $12, vs book of $10, and now you have the opportunity to start buying it back @ $8 vs book of $10. Figures used are for illustration only.
    Mar 17, 2015. 05:10 PM | Likes Like |Link to Comment
  • Annaly Capital: A Very Serious Check-Up [View article]
    Let's go with the concept that NLY uses a portion of it's surplus cash position over time, like many major companies do, to buyback shares. They do not take 100% of cash on hand, just a portion of their cash that they feel is "extra" and not needed for daily/long term operations. Thus NLY could start to reduce their outstanding shares, yielding less shares outstanding thereby reducing it's gross dividend payout to all holders as some shares will have been "retired". If the "earnings as reported" remain stable, then EPS, as defined by NLY, could yield a higher per share result. Stock price should move upward and NLY could actually increase it's cash dividend payout per share on the remaining shares which would certainly help the stock price as I believe that NLY trades mostly on yield and yield potential.
    Mar 16, 2015. 03:39 PM | Likes Like |Link to Comment
  • Annaly Capital Management: It's Time To Demand Repurchasing Shares And Special Dividends [View article]
    MW--WHOA there big guy.. I too need to see the reference and date that management stated that they may go to 11x next quarter. Difficult to believe/think their is enough paper out there that would allow 11x?? in such a short period as refi's are soft and new mortgages granted/issued have not picked up steam. Furthermore the FED may go to boosting short rates. PLEASE provide us the statement as this would be a significant change in philosophy by NLY management and a BIG DEAL.
    Mar 16, 2015. 11:53 AM | 1 Like Like |Link to Comment
  • Annaly Capital Management: It's Time To Demand Repurchasing Shares And Special Dividends [View article]
    Stockholders will need an activist or someone with a current substantial position to push the concept. However, stockholders can start to be heard by voting NO to all items they are asked to vote on, including ratification of accountants. This alone will not get them to change their ways, but it's a start, and maybe someone will notice that stockholders are not happy with just status quo.
    Mar 9, 2015. 10:50 AM | 10 Likes Like |Link to Comment
  • Why EOG Resources Is Delaying Well Completions [View article]
    It seems that all shale producers have/are cutting back on drill activity. Most producers, unlike EOG, have a weaker balance sheet and have to drill in their best areas because they need the best cash flow they can get now in order to service expenses.
    Mar 9, 2015. 09:32 AM | Likes Like |Link to Comment
  • Declining Quality In Book Values: Why I Don't Buy The Discount At Annaly [View article]
    I'm not so certain that we have a "clown" team. In fact, I think they are fairly smart. They are getting the job done, you just have the wrong definition of "job" . They appear to be doing what gets them the most $$$ while offering a common $1.20 per year. So far, "job" well done. Time to think about how you vote your ownership interests.
    Mar 6, 2015. 10:27 AM | Likes Like |Link to Comment
  • Declining Quality In Book Values: Why I Don't Buy The Discount At Annaly [View article]
    I'm sure that what is preventing DMcM is that he isn't a major stockholder. It's up to all the stockholders, combined, to think about how they vote their ownership interests.
    Mar 6, 2015. 10:21 AM | Likes Like |Link to Comment
  • SandRidge Energy: Can It Survive? [View article]
    I believe that mj88- has some really on spot comments. I do not believe, at the present moment that any investment in SD is acceptable. This analysis and others are pointing towards SD having the ability to survive thru 2015 with a combo of cash on hand, new cash flow and bank borrowings. Who puts money/invests in a company with a current best outlook of just, maybe surviving the next 12 months. Assume oil does return to $80 late this year, where does SD get the capital to drill in 2016, having used it bank credit, cash on hand and 2015 net cash flow to drill modestly during 2015?. What about a slightly longer term view>>with the "hope" that oil will return to $80, where in the heck does SD get "NEW" money to ramp up 2016-2017 drilling, start to accumulate enough cash flow/cash to pay down/off an outstanding bank credit, pay the long term bonds, redeem the preferreds and still have something for the common stockholder?? One must remember that SD is the major lime player as mostly all others have left, that leaves who to buy the assets at what price?? Answer: the bank will get the assets to satisfy their position.
    Mar 6, 2015. 10:14 AM | Likes Like |Link to Comment
  • Declining Quality In Book Values: Why I Don't Buy The Discount At Annaly [View article]
    CWMF- SO-O-O true. They are letting the commons, ie OWNERS, down, thinking of the owners as just yield oriented. (which most are) Repurchases seem to be a win-win for all: buy it back now @82%, and then later go to market, if necessary, and issue some @ 100%. If their compensation was tied to stock movement, you can assume they would be buying outstanding common in a significant way by now.
    Mar 3, 2015. 04:29 PM | Likes Like |Link to Comment
  • Declining Quality In Book Values: Why I Don't Buy The Discount At Annaly [View article]
    I'm thinking that the book vs share price discount is really due to interest rate spreads narrowing and the possibility of the divy being reduced. Management compensation is more tied to book value vs assets under management. Thus this group, ex MikeF. has told us that if you do not like the current 30c per quarter, go somewhere else. It's pretty straight forward, right now they think of common stockholders as a form of preferred @ $1.20 per year with the ability to reduce or increase the payout, sort of a variable rate preferred. Otherwise, what chief executive wouldn't be buying back shares with an 18% discount. If you think management is paid based on "assets" then management could raise the debt level. No, I think they have a juicy situation with common getting $1.20 per year until the spreads change. Forget by backs as this management team is not getting paid for stock price appreciation and is not "looking" for new equity. However, management does own stock options and one would think that would drive them to enhance stock price. My conclusion is that with NLY you take the current $1.20 that is being offered and assume right now that this stock price is trading on yield only and watch the spreads. If a common is unhappy then one can vote your shares against this team or sell and move on.
    Mar 3, 2015. 09:26 AM | 2 Likes Like |Link to Comment
  • A Covenant Trip Is Coming And SandRidge Knows It [View article]
    You are correct to point out that the banks may not work with SD. This is really a very tricky situation at today's pricing, as you have pointed out, as well as f2f- see next post, below. If indeed the banks say NO and pull the R/C; the author points out, at current prices he estimates that SD will not have enough cash to continue with ~8 rigs commencing with Q3/15. Thus it would seem that if SD doesn't get the bank cooperation, or replace the liquidity, or reduce rig counts further, or sell an asset, TPC has to do something, otherwise how does SD continue? This is why I'm raising the question about TPC taking SD private.
    Feb 11, 2015. 08:21 AM | Likes Like |Link to Comment