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Hatteras Financial Corp Message Board

  • mmg542003 mmg542003 Oct 2, 2009 9:53 AM Flag

    What's Driving this Drop?

    Looking for peoples' thoughts about this fairly large drop. Is it just normal correction after good run-up? People who bought for dividend capture moving on? What about JPM downgrade? What was their logic for that? Are we looking at potential big dividend cut? Even if its half, still not bad, right?

    My understanding of the biz model is as long as rates stay low, profits are pretty firm. With unemployment numbers this morning, looks like rates are low as far as the eye can see.

    Sounds like hang tight, perhaps add more......Comments?

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    • Cramer didnt know beans about HTS 2 days ago and now he's some kinda expert after discussing the stock with some "expert" in his office? Then he gets on TV and expresses an opinion and this makes the stock move? Gimme a break.

    • Because I did not expect this much of a price drop since HTS peaked at $33.59 on 9-23-09, I have done some research this morning to try to figure out what happened that I missed on 9-23-09.

      I found out that Cramer made very negetive remarks about NLY on 9-23-09 and there was a downgrade for HTS and that all of the MREIT's that I owned were down the very next day!!!
      Then on 9-24-09 there was another downgrede for HTS.
      http://finance.yahoo.com/q/ao?s=HTS

      Then on 9-30-09 SmarTrend made a sell recomendation for HTS,
      SmarTrend, our proprietary pattern recognition system, called a Downtrend for Hatteras Financial (NYSE:HTS) on September 30, 2009 at $30.38.

      Now on 10-16-09 Cramer has made negetive comments about HTS.
      http://www.cnbc.com/id/15840232?play=1&video=1297726075&__source=yahoo%7Cheadline%7Cquote%7Cvideo%7C&par=yahoo

      I do not like the way that Cramer's comments and the Analysis can move Stock Prices but they Do !!!

      I now think Craner's latest comments will probably cause HTS to go lower.

    • Spoke to Company this AM. Drop due to downgrades. Reason being HTS bond value may go lower which would lower their Book Value. This stock is valued on book value not on eanings or div. yield. No major change is anticipated at this time. Its a cautious move by the analyst.

      • 2 Replies to Malta999
      • The board for NLY, a similar stock to HTS, has alot more activity than this one. An article posted under NLY headlines is instructive for HTS. http://www.smartmoney.com/Investing/Stocks/Trusts-Offer-16-Yields-With-a-Catch/. Lower stock price and divy cuts appear inevitable.

      • This is my first entry since becoming aware of HTS, NLY and the other MBS companies since a Stansberry newsletter in spring 2009 recommended HTS and NLY. I should have invested back then, given what's happened with at least the share price. Having read the Barron's article, I understand the following ~

        -- From Barron's "The risk is that short-term interest rates rise and/or mortgage rates decline, squeezing the spread Hatteras earns on its money. Short rates are expected to stay low, but lately mortgage rates have been falling." What indicator can I follow on Yahoo to track mortgage rates? I've been watching the spread between the LIBOR and the 10-year Treasury notes at http://online.barrons.com/data. My assumption is that a narrower spread than what we have had for some time will reduce the quarterly dividend.

        -- In the thread that posted the Barron's article, Malta999 said "This stock is valued on book value not on earnings or div. yield" What indicator can I follow on Yahoo to track BV historically? Or, is it just entering the latest BV values into a spreadseet?

    • This has to be Ex Div related. Just look at the chart over the last year or so. HTS goes down right after Ex Div. Oct 2008, Dec 2008, April, July and Oct of 2009. Same story every time. I have no doubt the trend will continue.

      Im expecting 34-36 by the 4th quarter ex div date. LOL.

      I know im a newb, so forgive me if i just stated the obvious. lol

      • 1 Reply to cfleet2
      • Ah, so this must be the reason.....?

        "On October 9, 2009, Hatteras Financial Corp. (the "Company") and Atlantic Capital Advisors LLC entered into a Sales Agreement (the "Sales Agreement") with Cantor Fitzgerald & Co. Under the terms of the Sales Agreement, the Company may offer and sell up to 5,000,000 shares of its common stock (the "Shares") from time to time through Cantor Fitzgerald & Co., acting as agent and/or principal. "

        If my back of the envelop calc is right, this would represent about a 15% increase in shares when all 5 million are created.

        What's the "between the lines" read on this?

    • Im a newb. Just came into a lot of money, so i bought some high yielding stocks to generate income. Basically so i can just sit on my ass and do nothing but study a little bit on how to be a good investor. But i obviously bought in pretty high at roughly 32 dollars a share. Im getting sort of killed in this stock at the moment. But when i look at Hatteras' chart it seems it goes up up up and then down. Then repeat. SO im hoping we are getting ready for the up up up again.

      Ill admit though im itching to get out. Im at a 5 figure loss over the last 10 days or so.

      • 3 Replies to cfleet2
      • Cfleet2, congrats on coming in to some money! I am not an expert either, but I bought in at 29 after I read the very positive article in Barrons a few weeks ago. Since you are now flush with money, buy Barrons and read it. I see other people on this board are talking of the fact that the stock pays a high dividend thus the losses are due to people selling off the stock now that they have earned the dividend. It is bad practice, but it may pay to buy even more stock at this dip so that as more people buy in, ready for the next dividend ex-date, the stock will rise. (however, economic factors may also drive it lower as well)!
        Other folk, please offer an opinion on this as well.
        Thanks

      • Reads like you are getting a lesson from the market...

        In high divy stocks, always be aware of dividend dates....

      • This is touching the bottom range of the one year trend. I have nibbled a little, but if it breaks down below the trend I will have some decisions to make.

        10% short is not hugh, but they might be working on it a little, having covered and then getting back in after the ex-date.

    • It appears that several large holders were waiting for x-div to get out, which took the stock down far enough to set up several days of technical selling. For the first time in several months, HTS has broken it's 50 dma....not a particularly good sign, since this portends a change in trend. Can't make too much of this yet though.

      JPM didn't downgrade the stock, it was a small brokerage house, JPS I believe.

 
HTS
19.730.00(0.00%)Apr 24 4:01 PMEDT

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