Indeed, it is counterintuitive, but it works very well here.The investor in AGNCO can take that $430 and simply add it to their dividends. mREIT Invesco Mortgage Capital (IVR) has reinstated the dividends on their preferred stock issues as well as common shares.
I made the correction.Without reading the prospectus, I doubt the company has the option to pay preferred divis in script. With casinos shut for an undetermined amount of time, it’d be a roll of the dice to keep paying dividends at this point. Better than expected on book value and tons of forbearance agreements in place. Annual dividend prior to change: 60 cents per share. I have no business relationship with any company whose stock is mentioned in this article. Bears should be running for the hills and crying for their mothers. Mostly for entertainment value.Thanks Alex–you are correct.
We're going to run through them quickly.These changes come after a week where most of the mortgage REIT preferred shares rallied by at least 18% and several exceeded 200%. Normally we would favor NYMTO. If they do that, they have so many more dividends that AGNCM never catches up.
Don't think about it as how many shares they can buy for $22,000. Get access to several features you won’t find on the public side.You can get access to everything we have to offer right now.
Both the preferred shares and common shares still have a substantial amount of upside.
We decided to start reducing risk while we have the opportunity to book some huge gains.NLY-D got a premium for the fixed-rate on the shares.
I'd say on a relative basis the valuations look pretty equal compared to each other:However, I also would note that overall I think these shares are still offering a pretty good risk/reward for investors who can take the risk. Meredith Corporation (MDP) is a company that most people may not have heard about it.
Buying during the panic has given us some opportunities for incredibly low entry prices. It owns many … If shares are called, tell me about how we're "missing out" by getting called at $25.00 on a $4.01 investment.We don't usually buy shares with a 40% yield. Last week, peer Macy’s Inc also suspended its quarterly dividend and said it would borrow $1.5 billion from a revolving credit facility.
Somehow the IVR preferred shares are trading in the $15.00 to $16.50 range even though the preferred dividend is still suspended and we haven't yet had a significant positive announcement. Some of these shares have their dividends suspended, but several don't.We tend to warn investors away from any shares with a very high dividend yield, but we've found far more opportunities in high-yield shares lately.Given a wild swing in valuations, we updated targets for the vast majority of the mortgage REIT preferred shares. AGNCM's advantage in income only exists for about four years.No major difference in valuation. The previous announcement was here. What a ride!I own a couple hundred shares of this turkey. The first image covers dividend factors and call risk:The second image (scrolling right) takes us to information about the floating rates and other risk factors:Source: The REIT Forum's Google Sheets (Preferred Share Tab)We don't usually post such a large chunk of the spreadsheets in a public article, but it will make the upcoming discussion much faster. However, I do think these shares look a bit expensive near $20.00 given the cheap valuation on several other shares. Beware, these are still very risky shares.We closed our position in MITT preferred shares on Thursday.
That should continue to be the case.
That is because NYMTO normally has a lower price than NYMTP and higher yield.These images come from The REIT Forum Google Sheets. We won't complain about the work since it pushed our portfolio higher.The enormous rally comes as ideas of forced liquidations are forcefully put to rest.
We expect NYMT to turn the dividend back on in the future.
100% of the adjustments resulted in higher price targets.
We're also buying when the market is terrified. We've given you several ideas.
However, there's more upside on the others.
"The spread for AGNCM is 4.33% and the spread for AGNCN is 4.99%. The dividend and buyback suspensions are likely to continue as the economy goes into a deep recession and sales crater, squeezing households, businesses, governments and the health-care system. Now investors can claim that it isn't a market failure.
Since this trade was about increasing income and upside, we wanted to be as close to having the exact same dollar amount invested as possible.By keeping them close together, the trade becomes easier to demonstrate. That could help push prices higher. Sure, we pocket an extra $10.775, but that's hardly the point of the trade.Despite the lower yield on AGNCO, saving over $1 compared to AGNCN makes up for the difference in dividends.AGNCM trades higher than AGNCO by $.43. Our weighted average price was just under $4.01.Correct me if I'm wrong, but that's much lower than $16.36. A low-risk share wouldn't carry yields near this high.
DX-C looks too expensive, all things considered.
Not in five years, not in 100 years.
It just doesn't happen much.
That may sound counterintuitive to most experienced investors. The first two images cover everything which starts before "MFO" going alphabetically.
This is NOT a low-risk share. The market rarely offers us a deal like that. So, if they want to pay anything on the common they have to pay the pref in full, in cash.
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