Annaly Capital Management, Inc. Message Board

The government has nly in their cross hairs...notice stock slowly sinking...nly cannot compete with federal reserve...say goodbuy to this high yield...watch for div deduction next month

Took a quick look at the yield of NLY over the past 5-6 yrs. Basis: Looked at the share price on the 15th of the month following the annoucement date going back to 2008. That allows the stock price to adjust for rate and exdate of prior quarter divi. Annualized the quarterly divi and calculated the yield on that date. Simple exercise but somewhat useful.

Results:
Low yield is Apr-13 price at 11.6%
High yield was Oct-08 price at 18.6%
average seems to move to 14-15.5% range.

Thoughts?

I know - "past performance is no guarantee...", but in view of the recent little hiccup in NLY price (caused, apparently, by panic over AGNC book value shock), I thought it would be instructional to examine NLY total returns since 1997.

I obtained the data from the "historical prices" information right here on Yahoo, which is very useful because it shows "adjusted" closing price information daily - adjusted for dividends and splits - and can be downloaded into a spreadsheet.

The chart of "adjusted close" since October, 1997, plotted on a semi-log scale, is very revealing. I wish I could figure out how to post it here, but I am basically a hardware type, not a softwareoid. However, some statistics are very interesting:

I calculated the trailing 12 month (TTM) total return of NLY - price change plus dividend - on a daily basis over the period of the available data, up to and including Friday, May 3, 2013. The average TTM return is 21.4%. This is not too shabby.

The other side of the coin is "risk", which I measure as the variance of the TTM return. This comes to 7.29%.

So the ratio of average return (alpha) over variance (beta) is 2.94.

I don't know what is going to happen when the next financial crisis hits us, but if NLY could continue on it's statistical course going forward, I would be very happy to be invested in it.

Do your own due diligence, but this is my offering.

The average volume for Annaly Capital Management has been 8,769,800 shares per day over the past 30 days. Annaly Capital Management has a market cap of $15.0 billion and is part of the real estate industry. Shares are up 10.4% year to date as of the close of trading on Thursday.

TheStreet Ratings rates Annaly Capital Management as a buy. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, attractive valuation levels, expanding profit margins, good cash flow from operations and notable return on equity. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.
Highlights from the ratings report include:

The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Real Estate Investment Trusts (REITs) industry. The net income increased by 57.2% when compared to the same quarter one year prior, rising from $445.56 million to $700.50 million.
The gross profit margin for ANNALY CAPITAL MANAGEMENT is currently very high, coming in at 95.60%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 76.74% significantly outperformed against the industry average.
Net operating cash flow has significantly increased by 121.67% to $352.76 million when compared to the same quarter last year. In addition, ANNALY CAPITAL MANAGEMENT has also vastly surpassed the industry average cash flow growth rate of 36.21%.
Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market on the basis of return on equity, ANNALY CAPITAL MANAGEMENT has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.

Oh yes with rates so low it is putting pressure on Nly. Will lose big money because of this.