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American Capital Agency Corp. Message Board

  • mrwizard9090 mrwizard9090 Mar 1, 2013 2:52 PM Flag

    earnings overhang

    $2.18 per share as of Dec 31, 2012. paying a $1.25 dividend on the new shares(that really have not earned it) cuts the overhang to $1.68 per share(based on the new share count).

    that is the real SPO headache. it compares to what the cable companies do. new customers get a discount, while continuing customers pay full freight.

    they really should look into ATM offerings.

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    • Somebody brought up this notion about six months ago: Is it possible that Kain could have put the cash to work before the offering brought it in? By increasing leverage temporarily, the assets can be acquired and then go to work immediately weeks before the cash arrives. In this way the spo shares have started earning their distributions before they are even issued.

      "new customers get a discount, while continuing customers pay full freight."
      I have been thinking about this. The common had been in the early stage of it's dividend run, so part of the distribution was baked into the offering price.

      With extra undistributed cash like that, ...What if there is a slight increase above 1.25? extra pop bonus on the div run. If he takes a buck and divides it by four quarters, a new div could be 1.50. That would rock the stock to 35.

      • 1 Reply to slegermark
      • shoulda, coulda, woulda.

        there is no evidence that any extraordinary measures are taking place. if there were, bragging should be occurring. not only that, a number of companies have gotten into SEC trouble over the years by moving stuff of the sheet just in time to avoid reporting, and then bringing it back on right after the report.

        disclosure: i dumped all of my AGNC right after Benji announced QE3. however, if i had been a shareholder throughout, gifting 50 cents per share to somebody else, would really #$%$ me off. as it is, i can make the case that they owe me a buck per share for the time i did hold.

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