NYSE: NLY (Annaly Capital Management Inc) has closed at $18.07, and its traded Volume was 9962.6K shares, NLY opened the Day at $17.95, it made an intraday Low of $17.94, and an intraday High of $18.07. Price and Moving Averages analysis: NLY’s close price is above its Short term moving average, short term moving average is currently above mid-term, and above long term moving averages. From the relationship between price and moving averages: This stock is BULLISH in short-term, and BULLISH in mid-long term. Bollinger Band analysis: NLY (Annaly Capital Management Inc) has closed below upper band by 13.2%. Bollinger Bands are 55.9% wider than normal. The large width of the bands suggest high volatility as compared to NLY’s normal range. The bands have been in this wide range for 6 bars. This is a sign that the current trend might continue. This stock’s Yearly High is $18.07, Yearly Low is: $13.043, it has supports at $17.43 and $17.05, resistances at $18.06 and $21.09. Overall, this stock is rated BUY today.
NLY’s earning is $2.04 per share, Next quarter estimated EPS is $0.62, current year estimated EPS is $2.42. Its PE ratio is 9.
Excuse me for being skeptical. Does technical analysis work for NLY?
I read the bullish behavior of NLY at this point in the dividend cycle as an opportunity for a secondary stock offering.
Yes, earnings are up and should be good for the current quarter. I am expecting a dividend of 65 cents and a peak stock price of about $18.40.
However, the big firms who get to participate in a secondary offering get such a low price that they have an incentive to run the price up early to justify the secondary. Is this occurring? I think so and am waiting for a close above $18.10 later this week.
A secondary stock offering will drop the stock price to about $17.60. Such an offering is good for management and the participants but bad for those of us who trade NLY.
NLY is, in essence, a levered play in the difference between short and long term interest rates. Such an investment will massively change in value when inflation occurs and interest rates go up. The USA is very slowly going from QE2 to a high interest rate Fed. However, there should be a stampede to get out of NLY when the Fed first raises interest rates. This fear keeps the price within the book value plus 2-4 dividends.
The best play is to buy immediately after a secondary and to sell either just before or just after the stock goes ex dividend.