Nothing really too bad there.
Nah...NCT is holding up better than most when looking at the broader markets. We're approaching oversold territory just under $6.
Although, there is more working against NCT than working for them at this point in time. IMO max stop for the divy is 18% in relation to share price which puts the maximum low price of $4.44 on the table. Earnings per share are likely to remain relatively stagnant with continuous dilution without improved CDO performance. BV per share is likely to remain relatively stagnant for the same reason earnings will. These are two major trade trading metrics used by many (not necessarily by the few who understand REIT balance sheets, particularly NCT's). If NCT starts missing analyst estimates, we are in for more down pressure. With a price above $5 the shorts will use these metrics to sell. However, IMO, NCT is a risky short, but to each his own.
The divy alone won't hold the short term. With .25 per share quarterly, NCT could still be at 5.55 per share at 18%. Consistant increases with minimal dilution and CDO recovery will be the only way NCT moves a steady north. Until then, it'll most likely be a choppy ride. I'm concerned that habitual selling will begin to trend with every divy increase in anticipation of that 10-15% fall when more shares are issued. If this occurs, we could be treading water for quite some time. It's hard enough to see appreciation, it's even more difficult with shorts nipping at our heels.
As an income investor I would not be unhappy if NCT "treads water" for the near future, as long as the divvy holds up there's not very much better around with what I consider comparative safety. Capital appreciation will come later with market acceptance of NCT's current direction with MSRs and increased cash flow from their other investments. JMHO.
Well, this is how money is made. Differences of opinion generate opportunities of which one side takes advantage and cashes in. If we head to $5.50, I will consider this as one of the few great opportunties I have come across in the last 10 years. Good luck.
To be fair, she did say "IMO". Everyone deserves to voice thier opinion. On the other side of the fence, I think $6 is about as low as we go, but who knows. I am kicking myself for not selling at $6.29 knowing we were going lower. At this time though, they could announce the closure of the $170 million MSR deal any time now or announce a new $100 million MSR deal from the money from the SPO. Either will give it a little jump. Dividend stays at .20 for at least 2Qs.
Article in the Washington Post today indicated stricter rules coming for mortgage servicers by the Consumer Financial Protection Bureau (CFPB) under the governments new consumer watchdog agency which hopes to achieve: transparency and accountability. Didn't sound as though this could be something particularly worrisome for NCT but who knows.