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Chimera Investment Corporation Message Board

  • djpicoman djpicoman Jul 12, 2011 4:52 PM Flag

    Anybody think CIM will ever get back

    to the $3.90+ range? I'm seriously considering selling it for a loss and putting my remaining capital to use somewhere else where I have a better chance on making it up, like NLY, ARR, or AGNC. I would consider holding if I had some glimmer of hope that we hold the mid $3's, but it just keeps bleeding more each day. Even if it stabilize here, it will take 4 quarters of dividends just to break even. Does anybody feel good about the next earnings report? Any chance they will raise the divy even just one penny? Those are the only two catalysts I can think of that will start moving this in the right direction. If the earnings report is bad or they cut the divy again, I fear we could see it drop all the way down to $3.

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    • any bad news 07/13/11

      • 1 Reply to watchfan009
      • For the past 2 years CIM has bottomed out in the 3.30-3.50 range before recovering to 4+ in the winter. Same thing appears to be happening this year. Same discussion past summers. Bottom line, this appears to happen every summer since the crash, so what is the big deal? CIM has lower debt than other REITS, lower leverage, lower PE and a 50/50 agency/non-agency mixture which may just be a blessing in the future.

        For those who want to jump on the bandwagon when things are overbought, go buy NLY and other high flying REITS, they have high debt loads and are very highly leveraged compared to CIM.

        Good luck with your investments.

        I prefer to buy low when others are afraid and sell a higher, I see nothing that says CIM is going out of business other than a lot of investors trying to outthink the direction of the housing market and interest rates, good luck with that.

    • Once again, what is it telling you? That there is something fundamentally wrong with their portfolio or the housing market is not recovering as quickly as predicted/hoped? Housing will turn. Here are some "facts": Household formations from April 1, 2010 to March 31, 2011 were 357,000 which is a record low dating back to 1968 when the census bureau began keeping records. In the last 10 yrs. new household formation averaged 1.3 million per year. A huge demographic pool is building behind the great recession dam. The dam will break and housing will soar. IMHO sooner rather than later. So...is CIM suffering from fundamental portfolio weakness or near term weak housing demand?

    • Yes.. add this to your "facts"
      CIM has cratered from over $4.30 to $3.38 today, a drop of over 20%, more than the yearly dividend, all in a matter of a couple of months, without any news or announcements.
      Millions of shares have been dumped by institutions who hold most of the shares.. just check the volume.
      This, tells me A LOT more than your "facts"

    • Thanks for the thoughtful reply. Less than a month until earnings release which will tell the tale of how nimble they have been. IMHO the sell off has been driven by the lack of a housing recovery which has at least in some quarters increased default risk. BTW the high risk traunches were sold in the first quarter not the second quarter please read the SEC filings. Thanks again.

    • Just look at the Facts, not BS:

      "Chimera Investment (CIM) This huge yield play is currently yielding 16%. The company grew profits by 64.47% to $533 million in FY 2010 through October, after posting a return to positive territory in FY 2009 by drawing in $324 million in profits from -$120 million in FY 2008. For Q1 2011, the company made $156.22 million in profits. In comparison, Q1 2010 resulted in $95.46 million in profits.

      Trading in the high 3s, it beat earnings estimates in many of the past quarters. This play is not for capital appreciation, but it is for the dividend payments. The company invests in U.S. government and private residential mortgage-backed securities representing interests in obligations backed by pools of mortgage loans."
      =====================
      Earnings still solid, I wish they issue some buzz about

      Divi rise, and then, welcome $4

    • we don't know what they did or didn't sell last quarter, notwithstanding the wild guesses by analysts and bs on this board. they are stuck with at least some non-agency because it is the retained collateral for their re-remic securitizations, and the eventual value of the backend (i.e. their profit) hinges on a housing recovery that ain't happening.

      if they *did* panic and sell off their lower quality non-agency portfolio late last quarter and buy agency securities they made one of the worst trades ever. non-prime, non-agency got absolutely hammered in May/June, before bouncing back 20%, and agency was super rich. if they made the trade you and the analysts were clamoring for, they're certainly regretting it now.

      holding a significant % of IOs, they were/are offsides on recent interest rate moves.

      the problem is no mystery if you follow the bond markets, but retail investors apparently didn't get the memo. even with the recent declines in price, they are still overvalued relative to NAV. also, shorting CIM is a really cheap, easy way for funds to hedge their non-agency bond exposure, especially as the cost of CDS on the ABX (and all HY) has shot up.

      Look at the chart for the ABX AA or A tranches (or even AAA) and tell me why anyone has reason to be optimistic about their prospects.

    • Why hang around. You could be making money somewhere else but there is nothing here but a nightmare. Waiting for this POS to find a bottom will be very painful.

    • Please explain the issues CIM needs to work out. Last quarter they sold the high risk traunches that were subject to downgrade and increased their earnings spread. They also increased agency paper to 25% of portfolio to reduce default risk. Cramer and Company continue to pile on with negative comments and I'm just trying to understand the specifics behind the headlines. Thank you.

    • No, if its investors' anticipate any split. A split is desired only when the price per share is so high that the buyers' can't. Reverse split always has a deterimental affect.

    • CIM will be 4+ before the end of 2011.

 
CIM
3.10-0.02(-0.64%)Oct 22 4:00 PMEDT

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