I know a lot of people are still underwater with respect to their NAV price on NLY, but with today's dividend, I am no longer in that camp. I've been holding, buying on the dip and reinvesting all dividend payments for the past several years. I'ts good to finally see black numbers.
Hang in their longs
Lol....if you let things like that bother you ... you should not come here.... some can absolutely murder the English language. But sometimes the info is good. Got to see around the trivial.
SGRP - low float, making $$$, range tightened....huge volume a few weeks ago and quiet ever since...keep an eye on it!! 3x to 4x from here!!
It looks like we have started the pre dividend drop. Part of that is from people who speculate on the announcement. Of course, the price will automatically drop $0.30 on the X-Date. Last quarter it dropped to nearly 10.75. With the improved confidence in the dividend, Buyers won't let it drop below 11.
This stock has always been cheap. I bought it in 2009 for $17/share. It has paid $10.38/share in dividends since I bought it. More than half way to becoming a free stock!
The price is driven by the expected yield. This is a $10 to $12 stock. Since the dividend hasn't dropped in 3 quarters, investors may be willing to pay more for it. But, who can tell?
We can all have different opinions, but we SHOULD agree that what is posted on this board will NEVER cause the price to rise or fall.
Very good analysis - I would also add that the current NLY management has never gone through what is expected to happen when the FED starts increasing rates. Hedging will be very costly thus reducing funds available for dividends. The market does not like MBS's right now anticipating higher interest rates which is reflected in NLY current stock price, trading below book value. Your comments were right on target.
1. No, it shouldn't be anywhere near $20 a share. It was only at $18 when the dividend was at $2.60 per share. The dividend is currently at $1.20
2. NLY is not a stock. It is a bond in stock's clothing. It trades based on interests and interest rate outlook. It has two main components that work against each other. If rates go up then the value of it's MBS holdings declines just like a bond ( which is what MBS's actually are). Working in the other direction is the fact that new money put to work earns a higher yield. Falling rates cause the converse and holdings increase in value and new money is put work at a lower return. When you factor in the hedging and the leverage it is impossible to predict earnings unless you are inside the company looking a the changes every day.
3. Traditionally, m Reits do better ina falling interest rate cycle than a rising one. We are at the end of a falling interest rate cycle and looking a one where rates will start to increase in the next year or two. Based on this I wouldn't look for any great increases in the stock price. This is a stock one invests in for the long haul. It is a dividend play not a stock to buy as a trade or to expect a great amount of capital appreciation.
4. The management can hedge very effectively in a stable interest rate environment or even a gradually changing one, but when rates spike rapidly and fluctuate widely the hedging becomes so expensive that it just kills earnings which is what happened last May and all m Reits got crushed. The stock will go up if the dividend is increased which I wouldn't look for any time this year, or when book value increases which in my opinion will happen but very slowly. So, if you're looking for this stock to run up to somewhere near $20 you are going to be disappointed. I would suggest you be patient and reinvest the dividends via a drip program and you will be fine.