NCT got a little bit ahead of itself. The price now reflects a 10% dividend yield (more or less) assuming we get a combined dividend of 1.06. There should be some modest price appreciation after the split when the dividend(s) actually total this amount. As earnings allow for dividend increases of either or both entities we should see additional PPS increases. This is not a tech stock. It it now selling for approximately what it went for in the last SPO. Slow and steady but better than most is what I am expecting from both companies post split with the dividend increases to justify it. I bought this company for income. I hope to have steady sustainable increaing income for the next several years with a nice increase in pps over time. Nothing has changed. GLTA!
I think the Newcastle guys have more rabbits to pull out of their hats. There's a presentation on the corporate website about how there may be profitable opportunities to buy non-agency securities, and then "collapse" the securities, and sell the underlying loans at a profit. And, the Newcastle guys think they might be able to "collapse" some of their legacy CDOs as well, the same way they sold CDO X. And, in the presentation, they say they expect to realize $850 million of the difference between the face value and market value in their legacy CDOs over 5 years or so.
Based on the presentation, the Newcastle juggernaut can keep rolling along. The NCT guys see opportunities to target 15-20% unlevered returns going forward. I have the sense that investors don't recognize and appreciate the opportunities Newcastle has to produce strong returns and stock price appreciation going forward. Fine with me! It let's me accummulate more shares at a very reasonable price.
I'm having a little trouble pulling the trigger at $10.75. I have enough cash laying in an account to buy over 800 more shares but just a little reluctant at this moment. Probably regret not doing it in another couple months.
Recently, one of the officers of NCT purchased $20,000 worth of shares @ 10.56, so it stands to reason that it should be near the bottom on the speculative curve until the final split/spin off occurs... ((Officers usually do not buy stock in their companies if they have any indication it would be worth less than their initial purchase price))
A few days more days of cautious waiting should not be that significant until all the specifics of the NRZ unit are known, as well as how the new stock trades.
The generalities of New Residential have been adequately presented previously ( see Bob's posts regarding it ); - Note, however, whether current holders of NCT will maintain their stock in both entities (unchanged) OR opt to sell NR's stock immediately and plow back into NCT only, remains to be seen... (Which direction the momentum swings is what I am more interested in -aside from the likelihood of another SPO in the near-term...)
aside: I hope gogo is feeling much better... It wasn't quite the same on this site without his posts...