The problem is that a lot of investors like to hit the buy/sell buttons just something to pass the time away, do not hold for the dividend even at 15% yields. I know I should have bought a lot more at $4.00, however when over loaded best to wait it out.
They must distribute at least 90% of earnings. They may (as they did last quarter) distribute more than 90%. Whether or not a dividend of .24 is sustainable (i.e. is not more than earnings) depends on how well they do in future quarters. Momma might think that they will earn over .24 in future quarters and, therefore, be willing to distribute .24 this time.
I believe the company will earn well over .24 in future quarters (including Q2 of this year.)
So if they earned $0.13 a share, and they have to distribute 90% of that, that's $0.117 a share.
$0.117 ( x 4 ) / $5.41 = 8.65 % sustainable yield ; slightly lower than we are getting now.
I’ve been vocal about not being overly excited about doing share buyback. I think there is short term fixes who are not long-term solutions. And while it's accretive, it's absolutely accretive I just don’t like what it does long-term impact to the company. If our stock trades down to levels where it was in January then you get to 50% of book. I think that those levels we’ve got to start to look at what’s going on in the world and we have the excess liquidities probably step into the market. I don’t think we can ever make the significant impact that really changes the course of the Company and I think that the excess capital that we can redeploy long-term will be more beneficial to the shareholders than buyback stock.
Look you know I think one of the reasons why we're transitioning and we're making this change is that the anticipation was that we were going to go into a different rate environment and I just don't think after the last three quarters or two quarters especially the fourth quarter into the first quarter. You're just not seeing consistent data that would indicate that either the world economies are improving or specific economies really improving at any significant amount, coupled with the pending election and all that uncertainty that will bring we just.
We're going to reevaluate our portfolio one of the things we're doing is as we put together a planned reallocated capital and look at what kind of yields we can generate. Not only with the assets that we will invest in multifamily but how does that look like in terms of external capital we can bring in and what kind of fees that drives. So we will be reevaluating our earnings potential we currently have not changed that plan today, I mean we declare the first quarter dividend $0.24, we're keenly focused on our economic book value return, we don't want to start generating negative economic book value returns and under earnings dividend and putting overall pressure on the economic franchise, enterprise franchise.
So we are sensitive to that. So we look at several factors in setting our dividend and we’ll continue to do so. And when we do make a change if we do make a change that change would be to a level that we would anticipate holding for an extend period of time as we’ve done in the past.
On May 3, 2016, the Company entered into a Membership Interest Purchase Agreement with the members of RiverBanc LLC ("RiverBanc"), an investment management firm that manages over $400 million of direct and indirect investments in multifamily apartment properties on behalf of both public and private institutional investors, including the Company. The Company currently owns a 20% interest in RiverBanc. Pursuant to the agreement, the Company will acquire the remaining 80% membership interests in RiverBanc for aggregate cash consideration of approximately $24 million. In connection with the closing of the acquisition, Kevin Donlon, the founder and chief executive officer of RiverBanc, will become the President of New York Mortgage Trust, Inc. The acquisition, which is subject to customary closing conditions, is expected to be completed during the second quarter of 2016.
Conference call tomorrow--may be bailing for fear nymt will miss again--ARR down $1.30 because they missed
their numbers and cut div--lets hope nymt comes thru--Good luck
Sentiment: Strong Buy