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American Capital Agency Corp. Message Board

kansaskeith 6 posts  |  Last Activity: Aug 25, 2014 6:31 PM Member since: Jul 16, 2008
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  • Reply to

    NII not covering distribution

    by jchambers1 Jun 13, 2014 8:15 AM
    kansaskeith kansaskeith Jun 28, 2014 5:36 PM Flag

    That's correct. And the conference calls I've listened to, literally for years, and a recent written report or two, have made it clear that nothing is forever. They're having to use part of the "kitty" to make the dividend payment so in the long run the current div level is certainly no sure thing. When one looks what's happened to interest rates, it's quite amazing it's lasted as long as it has.

    Sentiment: Buy

  • PHT over the years has been very, very good to me. That's an understatement. However, I took money off the table this morning and sold my wad at 18.36, having already locked in the July dividend when it went "ex" last week.

    May get back in, but not until we get a little more clarity after Thursday afternoon's conference call from management. Here's my reasoning. We know that PHT has been "dipping into the kitty" of undistributed earnings to keep the dividend level, and the last conference calls have made it clear that while the dividends were level for now, that nothing is guaranteed to go on forever. Since the fund has been continuing to use undistributed earnings to pay the dividend since the last call, I am figuring there might be a slight change in tone after this week's call, maybe preparing us more or an (eventual) reduction in the monthly divvy.

    If I am right, that could drive the share-price down and allow me to buy back in to this wonderfully managed fund at a better price. If I am wrong, I suppose the share-price could drift even higher while I am out of it. But how much higher can it go? As of yesterday's close, by my calculation it was already at a 30.5% premium over NAV. Anyway, that's what I did. We'll see. . . .

  • kansaskeith kansaskeith Jul 24, 2014 4:34 PM Flag

    Update, Thursday afternoon. The manager, Mr. Feltus, seemed generally upbeat in the conference call. He once again said, regarding the dividend, that nothing is forever. And he referred to the last paragraph in the company's written report that he said communicated exactly that. But in today's call he also indicated the divvy "is secure" for now, and by "now" he seemed to indicate one year and hopefully two. As I left the call, not one person had queued up to ask a question. Mr. Feltus must have known that, saying we could even ask about what the Red Sox should do if we wanted to. The operator was making one last offer so somebody may have come in later after I disconnected, but I doubt it. Generally seemed a relatively happy, and short, afternoon.

  • kansaskeith kansaskeith Jul 25, 2014 11:58 AM Flag

    Bought back in at a penny a share less than I sold Tuesday, so more than covered my commissions and am whole. Will have to watch this even more carefully (if that's possible!) going forward, but for now, no harm, no foul.

    Sentiment: Buy

  • Reply to

    Down ~4.5% !

    by cqlboy Jul 31, 2014 11:08 AM
    kansaskeith kansaskeith Jul 31, 2014 12:51 PM Flag

    My theory is that it is large holders / institutions concluding that the 30% premium to NAV is too rich going forward. Particularly with what is going to be (long-term) pressure on the dividend as interest rates rise, discussed in the conference call last week. Many sold off in one swoop, in my opinion, taking the premium down almost immediately to about 25%, And of course the broader market selloff didn't help, either.

    Sentiment: Hold

  • Reply to

    Rising Interest Rates

    by veee4 Aug 25, 2014 6:05 PM
    kansaskeith kansaskeith Aug 25, 2014 6:31 PM Flag

    As I interpret the last couple of conference calls from management, and the last printed fund report, the trend could eventually (the last call indicated mid-2015 or perhaps not up to a year after that) force a downward adjustment in the monthly dividend. Increased price volatility is also possible, we were told.

    Sentiment: Buy

AGNC
23.65+0.14(+0.60%)Aug 29 4:00 PMEDT

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