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Annaly Capital Management, Inc. Message Board

  • madhuben5 madhuben5 May 30, 2012 2:14 PM Flag

    Is NLY a buy at current price?

    Any thoughts, opinions appreciated.

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    • Hey Thrash Man,

      Smart move! Say Good Bye to Jonkai on the way out, and welcome to the winners, AGNC and MTGE.


    • Hey Jump,

      I've noticed you've made this statement now a few times:

      >>Also, any decrease in spreads via increase borrow rate will destroy anyone with max leverage but not so much the guys who are controlling theirs>>

      Do you understand the way leverage is achieved...the process? The performing portfolios at any moment are fixed, these aren't day by day arms. The spread is the spread on the current MBS and the leveraged short rates that financed them. When the Long rates go up on new purchases , in relation to short , it is a good thing!

      It is true that NLY on their existing pool of MBS, would have the ability to increase leverage on that existing pool and therefore take advantage of an increasing spread environment over AGNC, which has higher leverage.

      Is this what you are meaning?


    • Yes. Bought some today with proceeds of TCAP, which I've held since 12/9/10 and watched it grovel around in the $17 to $18 cellar for a year and a half. Yesterday TCAP announced a small increase in its dividend, so it peaked today at 30 cents above my purchase price of $19.90. (Buy the rumor; sell on the news.) Of, course I've enjoyed its 8% dividend for the last year.

      But NLY is paying 13% for now and I need to keep my money working.

      • 1 Reply to rogerwenman
      • Hey Roger,

        Go back and see how you would have done buying NLY vs AGNC back when you bought TCAP, on 12/9/2010. I'll help you:

        NLY bought at 17.93, with 3.63 in accumulated dividends, ending today at 16.33, for a gain of 2.03 or 11.32%.

        AGNC bought at 28.64, with 8.25 in dividends and ending today at 32.30 for a gain of 11.91 or 41.58% gain. That is a 367% difference!!

        Do not let Jonkai deceive you. Go with a winner, AGNC and/or MTGE. There is no comparison. Well, there is, and I showed it to you....;-)


    • Read this post on the link. Compare the returns of 14 and 1/2 years of dividends and CA with NLY, compared to 4 years with AGNC. Then answer your own question: (Hint: Buy AGNC and MTGE, not NLY!)


      • 2 Replies to reits_r_us
      • continued from last:
        anyone else wonder what in the world reitRus was thinking when he said "compare NLY returns to AGNC returns" for those time periods? did he want to prove himself wrong just for show?

        Initial Investment
        Initial Stock Purchase Date
        06/02/2008 (4yrs ago)
        Initial Stock Purchase Price
        Initial Number of Shares
        Number Dividends Paid
        Final Number of Shares With Dividend Reinvestment
        Closing Price as of 05/31/2012
        Final Value of Shares With Dividend Reinvestment

        Increase in Final Value of Shares Due to Dividend Reinvestment

        now here is the the important thing that one should gather from that, which reitRus doesn't seem to grasp.
        the final value of the NUMBER of shares is what is important. 206.85% the stock price can, and more importantly WILL go down, and stop growing in ALL MReits and also in ALL cases, will decline some years for several years, and go back to just doing nothing for other years. that doesn't make you money in the long run in an Mreit.

        so what do you have left that actually makes you money in an Mreit? their dividend. their dividend COMPOUNDED through shares. which happens much slower when the stock price goes up in the first years.

        as that 200% points out. in other words, AGNC shareholders have been hampered in all aspects, unless they were thinking of dying tomorrow, in which case they can claim victory. because even if they sell tomorrow and register those gains, a NLY shareholder, (or even an AGNC holder) will easily pass those gains just given another year or two. did he really think the share price would do that in the next two years too? (holy bat signal robin)

        reitRus's statements about the price per share show he has no clue what in the world is in-store for him in coming years. (well besides the fact he is trading the stock rather than reinvesting).

        (disclosure, i own lots of NLY shares, but i also trade options as a trader, (how ever i do it the right way)) so i am a trader also. heck why not with those gains to play with. you sure don't do it the otherway around though. (i "only" have 11 years worth not 14)

      • it is beginning to look like any time reitRus makes a prediction like that, one should run kicking and screaming in the other direction. quickly.

        and i don't know what in the world chart one would have to make up to come to his latest conclusion. watching paint dry?? say what?

        here is the actual "performance". incase someone actually wanted to know what "watching paint dry" looks like.

        using his dates:

        Initial Investment
        Initial Stock Purchase Date
        12/01/1997 (14.5 years ago)
        Initial Stock Purchase Price
        Initial Number of Shares
        Number Dividends Paid
        Final Number of Shares With Dividend Reinvestment
        Closing Price as of 05/31/2012
        Final Value of Shares With Dividend Reinvestment
        Increase in Final Value of Shares Due to Dividend Reinvestment

        let's see. $10,000 investment, equals $1.7 million dollar return. 8300% gain in shares..... watching paint dry indeed. That is how far off that statement is... you basically would have to be driving backwards on the autobahn to get a little more excitement in an investment.

        HELLO? anyone awake up there with a jolt? reitRus seems to not 'get it" though.

        cont next post

    • NLY and CIM: both buys at current levels

10.66-0.11(-1.02%)11:09 AMEDT