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Arlington Asset Investment Corp. Message Board

  • drh8 drh8 Aug 13, 2013 5:36 PM Flag

    let's try again

    can anyone give me an argument why you would go/stay long on this stock?

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    • It doesn't sound like you want a discussion. You just want to denigrate any who does not agree with you. The truth is that this will probably go down some mire before it goes up. If you sell now you can probably buy ut back cheaper. But I think that by the end of the year it will be higher than it is now. Do what you want. Nobody cares.

    • I think that the argument has already been made and the reasons given. I would refer you to the CC highlights that have previously been posted and then ask what was asked before "what is there not to like?"

      • 2 Replies to lunco
      • drh8-here is some information from a SA article about AI that I for one found interesting:
        84% agency / 16% non-agency (non-agency is held at 64% of face value)

        "AI is actually a C corporation with large tax loss carry forwards, not a REIT. This is significant because it means its dividends qualify for the lower dividend tax rates and should continue to for years. It means in a taxable account with a 28% marginal tax rate their dividend is equivalent to an mREIT paying out roughly 19.6%. Thus, AI has one of the highest paying dividends out there. Despite this and a decline in spread from Q1 to Q2 (due to increased hedging expense), the dividend is not judged to be at significant risk. They were able to well cover it with taxable income in both Q1 and Q2 and have leftover unused taxable income of almost a half a dividend payment so far for 2013. I gave AI a dividend risk rating of B+. AI was one of the few mREITs to add economic value in Q2, +78¢ per share or 2% (= change in economic value / Q1 book). It predominately utilized Eurodollar hedges and proactively increased those hedges during the quarter. They seem to have worked well. For this reason, its stellar hedging and its low leverage, I gave AI an A on book risk. Last, in addition to its high dividend, AI currently trades at a significant (26%) discount to book. It has the highest economic potential of any of the mREITs reviewed and thus received a potential reward rating of A. With resilience to book value loss and dividend cuts as well as significant reward potential, if you were only going to buy one mREIT stock, AI is the one I would recommend."

        I would be very interested in any meaningful comment you might have concerning this article.
        In hopes of a meaningful reply

      • Lol..yield up ai down...taper coming lol......keep holding till its at 2bucks lol...

        Sentiment: Strong Sell

 
AI
10.92+0.26(+2.44%)Feb 12 4:00 PMEST