I still like it, have been in and out a few times, usually at a gain and then buy back lower. Am in it mainly for the dividend. which the last conf call seemed to indicate was secure short term, but also said that nothing is forever. Pretty noticeable chop today, which allowed me to buy back some I had sold, though even at these levels I remain concerned about premium to NAV.
Sentiment: Strong Buy
Yes, the dividend, when finally declared, went up. That would also be a positive as to share price. The other thing that happened was the company announced that previous released numbers were incorrect, and it still has not filed its 2012 10-K form with the S.E.C., saying because of the errors and corrections it needs up to two weeks more to file its late 10-K. The bottom line numbers were apparently not affected by the error the company has discovered (it blames a third-party's software product), but "core earnings" were. And the new dividend, as I read it, is all but one cent of the previous quarter's downward-revised core earnings. In some cases, accounting irregularities can be a negative as to share price. Now, I am not a C.P.A. but there is the obvious question as to whether they took the dividend up to within a penny of core earnings to offset any whacks they might take in share price from the accounting mistakes. I'm not smart enough to prove that, but I wonder. And thus I wonder whether the share price will open up, down, or about the same, when trading begins today.
(I knew when I went to bed last night that the 10-K ,due April 1, still was not showing on the S.E.C. website, and I was pretty sure there was something going on. I pretty much concluded whatever it was somehow was related to the slow declaration of the dividend. Got up this morning and saw the announcement. Wow. Anybody can get hit by a third-party's foulup, but at least short-term I've lost a little respect. Now, give me 50 push-ups, WMC accountants.)
They ARE calling it "first quarter dividend," even if it doesn't go ex until April 2 or later. Messes up my quarterly books but I can live with it. Question becomes if they do this with the fourth-quarter divvy that "should" go ex- in December, and push it into January. I don't THINK they can do that one without triggering excise tax on the non-paid-out profits as a REIT, but I worry anyway because that would mess up my annual books and would be a lot worse than this March/April business.
See yesterday's thread: http://finance.yahoo.com/mbview/threadview/?&bn=a7569915-6bd6-3bc5-88b2-9e0e17e59555&tid=1364243502622-f5f0ebdc-b2de-4fd6-bf6b-459fe4516105&tls=la%2Cd%2C3%2C3
Answered his own phone, no voice mail, no secretary other than the switchboard operator I gave the extension number to.
I couched my question carefully that I wasn't trying to get any unannounced information, but I asked him to confirm that WMC still had the intent to issue quarterly dividends. He was very nice and genial, said "yes. . . we just haven't announced the first-quarter ex-dividend date yet."
He then volunteered a strong hint that the ANNOUNCEMENT would be this week, before the end of the month, and then told me that the ex-date normally follows by about a week. That tells me the ex- and record-dates, as well as the payable, may actually fall into the second quarter, though he definitely called this the "first quarter dividend." That will foul up my quarterly books a little, but as long as it is
(1) legal, and (2) all in the same year, I guess I can live with it. We ended the call by me asking if I should just check the press releases for the rest of the week and he said yes, or the company's web site.
If there is any problem or interruption of the divvy, he didn't betray it in our chat.
You are not correct. There hasn't been a PHT special dividend was in December, 2007. I was particularly aware of that since I didn't come to this fund until sometime in 2008 and I have never - not one time - seen a "special dividend."
Each year since then, there have been two dividends of .1375 (some charts round to .138) that have gone "ex" (and been taxed) in December, the second of which is always paid in January. And in each of those years the next "ex" wasn't until February. Like clockwork.
This is plain-and-simply S.O.P. for this fund, and is unrelated to this national embarrassment called "The Fiscal Cliff."
You say you want me to check in "Yahoo," so I ask you do the same, by clicking here: http://finance.yahoo.com/q/hp?s=PHT&a=03&b=29&c=2002&d=11&e=30&f=2012&g=v
Also, blowing my own horn just a wee tad here, there was similar misunderstanding last December, and I explained it on this message board then: http://finance.yahoo.com/mbview/threadview/?&bn=f20c89ce-6620-39be-b06b-8c5e3248457c&tid=1324410245000-4d432a92-880d-30a2-90a0-2b0f9a4e0ad8&tls=la%2Cd%2C49
***HOWEVER,*** you *are* correct about one thing, that "many misunderstand the nature of the 'hit.'" Over on the mREIT side, which like this fund in many cases isn't allowed 'qualified dividends', some of the selloffs have been even more pronounced -- but over there some commentators have belatedly begun to point out the same thing I have pointed here about dividend tax rates.
Sorry, Mr. Deadmeat, but you are for the most part wrong about that.
You're right that the dividend will be taxed as 2011 income.
Now, go back and check PHT's history and the fund does this every year - a dividend goes ex- and record-date before the year-end, payable the next. I assume, but don't know for sure, that their theory is that since they got the income in the old year, it gets paid and taxed in the old year.
(Other dividends are being declared early this year -- Costco and the parent company of Jack Daniels are two that come to mind. This is not the case with Pioneer High Income Trust, so please don't say that is the case. Again, check PHT's dividend history -- this simply is not new.)
You -- and a bunch of other people I've read in discussing mREIT dividends, too -- are also only partially correct in the language about a dividend tax increase if there is no agreement by the jerks in Washington.
Go back and check your brokerage tax statements from last year -- I just did -- and you will find PHT's dividends are non-qualified dividends (taxed as ordinary income), rather than qualified (taxed at the preferential dividend rate put in under Mr. Bush). This is because they are comprised of interest the fund made on its high-income bonds, not on corporate profits.
So yes, if the "fiscal cliff" happens, theoretically the tax on PHT dividends will go up, but only by the amount the tax on ordinary income goes up, NOT because the preferential dividend rate is going away like it might with corporations like Costco and Jack Daniels' parent.
PHT dividends for the most part never had that preferential rate. And with only small exceptions, neither did mREITs.
OK, I owned 3,000 shares of AGNC back in September. I waited til it went "ex" at 1.25/share, and then on Sept. 20 and 21 I sold all 3,000 for an average share price of 35.05, net of commission. I kept some of my powder dry, but also invested some of that money in things that pay monthly rather than quarterly dividends, went til they went "ex," then sold those too. Then today after hours I bought the 3,000 shares of AGNC (that I had sold at 35.05 in September), but my share price today was 30.88 net of commission. So I got both the 3Q and 4Q divvies, plus I have another $12,521.34 in cash that I didn't have to spend in my buyback today because the share price was lower.
Yes, yes, I would have been even better off if I had bought before the announcement at market close. And yes, I realize the price is going to go down after the ex-date and may decline further in 2013 if the divvy declines then.
But for now, I am a happy camper. And in this world of ours today, sometimes one just has to live for now :)
The previous thread was getting a little bothered for me, so I thought I would post my guess (and that's what it is, though slightly educated) about the upcoming dividend.
Keep in mind this company has a history of EARLY ANNOUNCEMENT when it cuts (i.e., when it cut from $1.40 to $1.25).
So my reading of its financials (with my less than M.B.A. prowess, but still some care) is that the $1.25 quarterly divvy may not hold forever, or even through 2013, but that it can afford it at least one more quarter. Thus my prediction is we get $1.25 for the current quarter, with an accompanying (or following, within a few weeks) of a lower rate in the future.
Do I have any inside, nonpublic information? Of course not, but here on the message board is my prediction, for others to take potshots at when and if it falls flat :)
What annoys me about the huge butt whipping I've been taking the last few days in income-producing securities is that a lot of them - INCLUDING PHT - have been taxed at ordinary-income rates anyway, NOT at "qualified dividend" rates. I just went back and looked at my brokerage tax statement from 2011 and not one penny of my PHT income (in the several months I held it last year) qualified for the qualified-dividend rates. So why else would securities like this be going down so dramatically in price?: (1) one obvious reason is that people are rebelling at the high-premium to N.A.V., and that may be valid; (2) another reason is even the ordinary income rates (not just qualified-div rates) are going to rise with the "Fiscal Cliff," and on that one I just have a tough time believing for most taxpayers it will be allowed to occur. Maybe for those making more than $250,000 per year, but do the lion's share of PHT shareholders fit in that category?
I'm wondering if dividend chasers will affect the trading on Thurs. Goes ex-divvy Fri. a.m., correct?
Confirmed just now with Vanguard Brokerage Services, Oct. 10, 9:10 a.m. CDT, though I see nothing on "Quantum Online" as of this writing.
The man at Vanguard was not particularly helpful on the following question, so I ask here if anybody can help me out. If GE is calling 33 of the 40 million shares back, how does one determine how much of his own holdings are going to be called: is it proportional, or random, or what? Thanks in advance.
Nice research, teambuck2, Yes GEA is "6.625% Senior Notes due June 28, 2032," so at this point it's merely a matter of them moving from "may include" to "will include" and deciding whether it is in whole or in part. As to your other question, I will bet your soda that the call would be effective the next coupon date, which is Dec. 28 of this year.
I looked everywhere I could think of as to a call, couldn't find anything so called my broker -- Vanguard Brokerage Services -- and had them look. The man I talked to took one look at the drop, said "must be a call because that's a very unusual drop for a security like that." BUT. . . he couldn't find anything about a call on the Bloomberg service, either. I am wondering if it has to do with the parent company, General Electric, issuing $7 billion of AA+ bonds on its own in the last day, but haven't fully thought that through. Bloomberg, Schloomberg, my first suspicion is it has to do with a call.
Not sure this is the right indicator to judge the long-term health of the company, or whether the stock price goes above, or further below, two bucks.
I am hardly trying to say I am the only person with the following analysis, but falling print circulation bothers me a lot more.
As real estate markets ebb and flow -- and automotive and even the broader consumer economy do the same thing -- it is certainly is to be expected that lineage and revenue trends will do the same thing short and medium term. But long term, if the readers aren't there, the advertising will trend to go away, and that is what will control the financial health and the stock price.
The exception is if the revenue model can SUCCESSFULLY be adapted to electronic products of the company, and so far I still am not convinced.
As for circulation, just as one example, here in Wichita (hardly MNI's biggest player, but historically a sound paper) ABC is now listing M-F circulation as down to 67,250, which is down by many, many thousands in just a few years. (McClatchy's web site still lists daily M-Sa at 88,502 -- I don't think the website is trying to deceive -- it's just that things are falling that quickly.)
If that trend continues, who will want to advertise? -- even though short term (measured a whole lot less scientifically than NewspaperAdvertising does it) I think I am seeing an increase in ads.
Multiply that by the rest of the country and, until the electronic products can pull in decent-margin revenue, I just don't see how the trends NewspaperAdvertising is seeing (even they well may be accurate) are going to revive the company or its share price.
Sentiment: Strong Sell
Yes that is the record date, but since sales take three biz days to settle if you sell on 6/27 you ARE still on record up through 6/29. Thus, the following is uncontroverted:
Sell before the "ex-date" (in this case 6/27) and you don't get the dividend. Sell on the 27th or later, or don't sell at all, and you do.
There is a lot of confusion between the "ex" and "record" dates, but the above summary is correct. Really! If you want the divvy, don't sell before the 27th, thus you will still legally be on record on the 29th, and you will get it. Period.
NEW YORK--(BUSINESS WIRE)--
The Board of Directors of Annaly Capital Management, Inc. (NYSE: NLY) declared the second quarter 2012 common stock cash dividend of $0.55 per common share. This dividend is payable July 26, 2012, to common shareholders of record on June 29, 2012. The ex-dividend date is June 27, 2012.