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American Capital Mortgage Investment Corp. Message Board

  • glsimmons3 glsimmons3 Nov 7, 2011 10:17 AM Flag

    projections on qtrly divi?

    once investments pan out and income is stabalized... i'm guessing in the .75 to .85 cent/qtr range based on leverage, spread, and estimated cash flow / eps... this being based off of my limited experience in reit investment / trading... am i in the ball park on this one?
    buying slowly on dips.
    thanks for serious opinions on future divi

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    • Hi Ben,
      I hope you are right about MTGE. I was sitting one the side waiting for a dip at AGNC and thought, what the heck, and I went for a little just to see what happens. I would like another
      stock that I cAN pick up dividend and hold for profit before
      the next dividend. I don't think these two will work that way.
      GL and your thoughts?

    • Sid,

      While we have been at odds at time, I always feel a little better when you shorting the puts when I am long the calls. Good luck to you too!

    • DOc,

      As I explained on the AGNC board, I like the risk/return profile headed into ex-dividend, and I don't mind taking putting some money at work even with the price being as high as it is. I am comfortable with the valuatoin and the potential valuation, and as you know, I enjoy mental gymnastics that layout a move to $23 by ex-dividend. While other stocks that are thinly traded like EVEP are difficult to value, MREITs are not. It just depends on the what the market will pay for the spreads and the book value, at present, it seems like there is some money finding its way into the shares. My thery is that older names are a little worn out and the veneer of goodwill seems to worn off the older names, so a newbie like this with AGNC management who we believe in ought to be able to deliver without the encumbrance of a large portfolio. Hence, we have spreads of 2.40%, a dividend of $.80, undistributed taxable income of $.24 (which is easy to figure out) and a shot at high dividend. So, my view is why the heck not? I can afford to nibble with 51 calls here, so I am taking a risk, and as I said, it fits my requirements for a value I can determine. I just think we have good old fashioned rotatation into a new name with proven management and better spreads. I used to play AGNC all of the time this far out from ex-dividend. Why not here?

    • $1.50...........good luck to all.....will take the stock at that price and $1.50 is a decent premium for a 5 month wait.

    • Hi Ben,

      Hate to be a Greenspan but.....we are at a lifetime high for MTGE. Remember what we were trading post EX a short time ago. You will most likely be fine with your purchase at par, but I like to buy post EX or at spo, not at an all time high with a blow out top volume pyramid:

      I am sure(?) you won't lose because of the long dated contract. Myself, I'm waiting for this dust to settle....;-)


      BTW...explain to me the volume surge. 100k to 800k ?

    • Somebody is in there buying the Sept. 20's with me. Just grabbed about 51 calls at $2.00 to $2.05 each. I would buy more, but this is a new one for me.

    • Nice!

    • Just a follow-up, the total number of calls is 456 against 1,161 puts. That doesn't mean anything other than the fact that we have to be careful as to the number of contracts we buy given the lower relative volume.

      The 17.50's and 20's are the most popular with the nod to the 20's. So, it makes me thing if this is to be played, best to play the Sept. 20's as you said.

      There are only 20 open interest contracts in the Sept. 20's. Not much volume here.

      I wonder if in this case it isn't better to just buy 2,000 - 5,000 shares. Worth about $1.50 in gain I think from here.

      Anyway plenty of time to think it through.

    • Doc,

      You are correct and that is what I mean't. When I got my head into this last night, it was mid night. Yes, Sept. 17.50's are the ones I was considering. That is where the delta is 1.

      I think I said I was checking out the options, so I didn't know until now the delta on the 20's is .9450. Sept. 20's is a good choice.

      Good luck!

    • Hi Ben,

      Why would you want the June 17.50's when you can get the Sept 20's for the same intrinsic value, less outlay of capital/contract, plus three month's more time?


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