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American Capital Mortgage Investment Corp. Message Board

  • reikreik reikreik Apr 2, 2013 10:54 AM Flag

    why would they raise their dividend? their nature is agnc like - get a good yield

    deliver and keep producing and predictable and crack offerrings to grow

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    • Higher EPS = Higher dividend. It's simple.

      If MTGE can get core EPS to approach $4.00 or more as it takes advantage of much wider agency spreads and favorable dollar roll dynamics due to QE3 then there is a good case to be made that the dividend can go higher.

      AGNC is significantly underearning its dividend currently yet has a yield north of 15% vs. MTGE at 13+%. MTGE actually has lower CPR speed agency securities (lower premium amortization) and upside to BV relative to AGNC from non-agency price appreciation.

      If MTGE can get the dividend up the stock price should also benefit and they can raise more equity capital at higher and higher stock prices thereby solidifying the appreciation of the stock. A great virtuous cycle. Look at AGNC over the past 4 years.

      Sentiment: Strong Buy

    • From July 2009 to Sept 2010,
      when AGNC was about as old,
      and in the same pps range,
      it payed 1.40 a share dividend.

      They were still able to grow quite nicely,
      don't you think?

      If there was no overflow every quarter then things would be different.
      There are overflows.

      Raise the dividend!
      FOXY

      • 1 Reply to faaqcee
      • i dont agree completely

        all other companies were much higher as well

        as long agnc and mtge are at the top yield wise they dont need to raise - as they want to be able to support the yield for the next few years to continue offerring (mtge at least) -

        as you said agnc was 1.40 and was that way for some time - they didnt run around changing it every quarter - they only dropped it from 1.40 to 1.25 after many others had droppd theirs considerably (cmo went from .54 to .36 even)

        hts was 1.10 down to .80 nly .65 or so or maybe more cant remember down to .???

    • I couldn't have stated it better myself!

 
MTGE
19.728+0.068(+0.35%)10:13 AMEDT

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