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Invesco Mortgage Capital Inc. Message Board

  • oldschoolbuilder oldschoolbuilder Jan 10, 2012 10:50 AM Flag

    Credit assets prices higher during past 2 months

    For what it is worth, check out the rally in credit assets indices (CMBX and Prime-X) during the past 2 months. Should help BV at IVR somewhat (and boost confidence that BV is inflecting higher from here).

    Indices don't necessarily correspond as well to what IVR actually holds (IVR has higher quality assets that didn't go down as much in the first place) but the recent rally in credit should have some positive impact on IVR's marks on the credit assets the company owns.

    5 yr swaps were flat in 4Q, while agencies were up slightly.

    This bodes well for a fairly stable-to-higher marked to market BV today relative to 3Q quarter end.

    IVR trades at 85% of my estimate of current BV, which has upside if credit assets continue to move up (with better economic data and some calm in the markets) and/or if the longer end of the curve begins to back up.

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    • Old school on Nov. 2 you posted that you thought that IVR would earn 80 cents in the 4th quarter. Do you still feel that way.
      I would be happy if they just keep paying 65 cents on a steady basis.

    • Good post, oldschool. Finally some relevant data on comparables to what IVR owns and how it might be performing, instead of useless Seeking Alpha articles that claim there is no risk in owning a stock with levered assets paying an 18% dividend that lost 30% of its value last year.

      The big question is will credit assets move up, not just now, but later, especially in March when the Greek bailout is front and center again.

      • 1 Reply to marklibera
      • pws112 Jan 10, 2012 12:49 PM Flag

        Mark you posted:
        Re: SHOW AND TELL...!!! 5-Jan-12 08:52 am

        Here are mine (without listing the yields and not in any order):


        Most of these are MLPs. The exploration firms are EVEP, LINE and ATLS, the non-MLP exploration firms are MHR GPOR. The theme there is the shale boom.

        The gathering and processing MLPs are NGLS, APL NGLS and CMLP.

        Pipelines are WPZ, ETP, and EPB and ETE is the general partner of ETP.

        Royalty trusts are SDT, PER and CHKR.

        I'm looking to sell IVR on a bounce and may trim some of the MLPs with large gains to reinvest into the MLPs with the greatest potential (EVEP and MWE).

        The European issue won't go away (Greece has a big refunding in March) but the market could continue to rally until then, but any rally is not likely to be sustainable. Rating :
        (No ratings)Rate it: marklibera




        If you want to sell IVR on a bounce then I advise you to stop knocking the hell out of it whenever you get a chance !


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