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AGNC Investment Corp. (NASDAQ:AGNC) can look like a juicy high-yielding income stock for retail investors, with a yield of a little north of ~9%. This yield is often far from safe as the dividend has been cut
How To Play AGNC Investment Corp.
Summary
- The conditions could not be more ripe for this agency mREIT for large gains over the next one to two years.
- The FED is hesitant to raise the target rate in the near term as it may disrupt the progress of the currently fragile economy.
- I don't feel this is as good of a deal at 1.0x TBV but recommend cash secured puts or preferred shares.
I am always on the lookout for businesses that have a strong cash generating ability and a strong enough competitive advantage that I can be sure they will be around for the next decade, and at a price where I can be as sure as possible that I can achieve at least 15 percent annualized returns, or else companies whose price is deeply discounted from their asset base as long as its highly marketable. Im not one to shy away from takeover targets, provided the target still has a strong business that I would be okay with owning it even if the takeover did not go through. Since I began investing on my own 3 years ago I have achieved an annualized time weighted return of about 16 percent, and plan to continue to beat that hurdle as I learn more.
Analyst’s Disclosure:I/we have a beneficial long position in the shares of AGNC, NLY either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
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