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Two Harbors Investment Corp. Message Board

  • we_is_reits we_is_reits Feb 22, 2012 5:36 PM Flag

    Today was a discount day to buy

    Good value today.

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    • I should have said also. If you are below a dollar pps and warrants are below a dollar with 6 month or more ( r/s imminent ) sell!!! I'm done.

    • Warrants above pps is great! Warrants at or below current pps!! Sell!!!

    • Thought I might post the warrant details in case anyone is interested ... basically the exercise price is $11.00 and they expire in Nov 2013 ... so, if you think that the recovering real estate market will allow the non-agency part of TWO's portfolio to appreciate increasing book value to roughly $10.50, or above then a Price-to-Book ratio of 1.1x will easily push your warrants well into the money ... and you would very easily triple your money from today's level ... any gamblers out there?
      ---------- From 10K ----------
      "In addition, in connection with the closing of the merger transaction, we entered into a supplement and amendment to the agreement that governs the warrants, the terms of which, among other things, (i) increased the exercise price of the warrants from $7.50 per share to $11.00 per share, (ii) extended the expiration date of the warrants from November 7, 2012 to November 7, 2013 and (iii) limited a holder's ability to exercise warrants to ensure that such holder's Beneficial Ownership or Constructive Ownership (each as defined in our charter) do not exceed the restrictions contained in the charter limiting the ownership of shares of our common stock."

    • If your theory is correct, and book value climbs rapidly as the real estate market recovers ... and shareprice rockets above $12 ... then perhaps the warrants are the better play, eh?

    • And if this is accreditive, AND the rmbs do better than expected(which is not hard to obtain when gotten at the discounts we are being told about) in the future as it looks like they will, if the current trends continue, wheter slowly OR at a faster pace in real estate, then this stocks book value may now go way way up...and this stock may not see less than $12.00 plus a share or more...any time soon.

    • The one caveat that I would mention is that IF this is dilutive, the dividend will go down. If it remains the same for the next few Qs (and especially if it goes up), we will probably not see $10 again for a while.
      Time will tell.

    • waynesonnen Feb 22, 2012 7:31 PM Flag

      I have no clue what you mean by "discount day to buy." The offering was well above BV. Since early January, there has been maybe 5% recovery in non-agency MBSs.

      This offering was good for existing shareholders. I added more on the January offering, and again today. I don't know if we'll see 40 cents, but I'm optimistic about TWO in the long-term.

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