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American Capital Mortgage Investment Corp. Message Board

ray858945 55 posts  |  Last Activity: 9 hours ago Member since: Sep 17, 2012
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  • ray858945 ray858945 9 hours ago Flag

    I think there is a 50 - 50 chance that this is correct. Even if the rates are raised, it might not be more than a single raise of $0.25 later in the year. Bove has had a spotty record making predictions, however, especially with regard to timing [we all have, but we're not on TV].

  • ray858945 ray858945 9 hours ago Flag

    MySon ...

    I am a big holder of RSO like you, but I see it this way:

    There is all of RSO except for the MREIT business, and there is the MREIT business. RSO AFFO will be moving up slowly while the MREIT business will be volatile. Last quarter RSO did $0.20 less $0.04 of hedging losses at the MREIT business.

    One problem with MREIT's - and the reason I stopped playing them - is that they are hard to predict because no one knows the hedges in place except management. If they have another tough quarter, AFFO could easily be $0.16, but it could easily be $0.20 as well. I suppose it could even be higher, but I doubt it because of the interest rate volatility early in the year.

    The lesson: RSO might experience a little volatility going forward, but the trend is up right now. I think this was signaled by management with the originations update they just released. I think they were telling people that things are looking good ... don't sell now. GLTA

  • Reply to

    The Coming 1Q Results

    by davisfoulger Apr 20, 2015 2:15 PM
    ray858945 ray858945 Apr 20, 2015 2:39 PM Flag

    I agree, Davis. I was not in RAS when bad things started to happen so I don't have that negative bias. I believe we hit the bottom, and I bought 20,000 shares, a couple of weeks ago at $6.78. GLTA

  • Reply to

    RAS in a Nutshell

    by davisfoulger Mar 30, 2015 11:01 AM
    ray858945 ray858945 Mar 30, 2015 1:14 PM Flag

    Agree with you, Davis; this is the biggest no-brainer I've seen lately. I took the money from PSEC shares sold, and bought a full position of RAS a couple of days ago for $6.78. I think we could see $8.00 by the end of the year with rising dividends to boot.

  • Reply to

    Downside from Rights Offering

    by jimcooper28 Mar 19, 2015 12:44 PM
    ray858945 ray858945 Mar 19, 2015 12:55 PM Flag

    Jim ...

    I gotta agree. I was in for the NRF spin when the existing shareholders received shares in the new company without any payment, and the purchase prices and cost basis were adjusted accordingly. It was a tax-free transaction. Compare that to PSEC. I have been very disappointed by this deal, and, unfortunately, I'm out .... too much risk. Maybe it will work out, but I don't think the average investor can even understand it.

  • Reply to

    Could be interesting...

    by chrislane323 Mar 16, 2015 10:33 AM
    ray858945 ray858945 Mar 17, 2015 10:04 PM Flag

    Seeds ...

    Happy to hear about your pants. One reason to do a reverse split when your stock is below $5 is because a lot of institutions and funds can't buy stock below $5 as that's in their by-laws.

  • Reply to

    Spinoff question

    by pet2401 Mar 17, 2015 2:49 PM
    ray858945 ray858945 Mar 17, 2015 9:56 PM Flag

    beard ....

    I don't understand. You say that the cash would have to stay in the company, but the shareholders get nothing. Who owns the company, and therefore the cash? "The shareholders have to be compensated" is the same thing as what you are saying. You CANNOT sell the assets of the company with the owners of the company getting nothing. Period. If the money goes into the company, the shareholders are still getting it.

  • Reply to

    Spinoff question

    by pet2401 Mar 17, 2015 2:49 PM
    ray858945 ray858945 Mar 17, 2015 6:28 PM Flag

    Pet ....

    In Dec. 2013, I had a lot of NRF. They announced a spin, and the two companies are now worth an average of about $22 plus dividends. If PSEC handles this correctly - and I do think they are sharp marketeers - the effect is likely to be at least a double and maybe a triple.

  • Reply to

    Could be interesting...

    by chrislane323 Mar 16, 2015 10:33 AM
    ray858945 ray858945 Mar 17, 2015 6:24 PM Flag

    Seeds ....

    Don't wet your pants. You would have half as many shares also, so no effect.

  • Reply to

    Spinoff question

    by pet2401 Mar 17, 2015 2:49 PM
    ray858945 ray858945 Mar 17, 2015 6:09 PM Flag

    Pet2401

    No, I don't think management has to ask the shareholders as long as this is considered to be in the normal course of business. I am saying that the shareholders own all of the assets of PSEC. If PSEC spins off part, the shareholders have to be compensated with stock.

    I posted a comment to your post with a link to the registration statement for the first company to be spun: Prospect Yield Corp. I said that your post [and mine] were pulled by Yahoo because they don't allow URL's. The opening paragraph provides a mechanism for allowing your investment in PSEC between the several companies. Maybe you can post some of it .... it's your find.

  • Reply to

    Spinoff question

    by pet2401 Mar 17, 2015 2:49 PM
    ray858945 ray858945 Mar 17, 2015 5:52 PM Flag

    Pet2401 ...

    Good find. Yahoo won't allow a URL in these posts. It's your story, and you deserve the credit ... maybe you can find a way to do it, or copy part of it and post it, etc.

  • Reply to

    Spinoff question

    by pet2401 Mar 17, 2015 2:49 PM
    ray858945 ray858945 Mar 17, 2015 5:41 PM Flag

    Good find, Pet2401.

    The talk about buying shares is just a way to allocate the investment you have already made between the three companies. Let's say that there was one additional company to keep it simple. If you paid $100 for your PSEC stock, and they spun off 40% into a new company, then you get to use $40 of your investment to purchase the new company, and your PSEC stock is now worth $60 'cause it has less assets. That's the general idea.

  • Reply to

    Spinoff question

    by pet2401 Mar 17, 2015 2:49 PM
    ray858945 ray858945 Mar 17, 2015 5:31 PM Flag

    Look dude ...

    The shareholders OWN the company, all of its assets, and all of its liabilities. It isn't up to management to decide whether or not the shareholders get anything ... where did anyone get that idea. Management could sell additional shares if they need more capital, but that is really no different than a SPO.

    If there is a delay, it's probably because the stock price is too low for a SPO to be accretive. I don't know what the BV would be on the assets spun so I'm not sure. If that is the case, then they might have to re-structure the whole deal, or even just wait ....

  • Reply to

    RSO Dividend Announcement

    by seeds.bill Mar 16, 2015 11:46 AM
    ray858945 ray858945 Mar 16, 2015 12:06 PM Flag

    Yes, they have essentially already announced $0.16. Earnings for RSO and other interest sensitive stocks have gone down because interest rates have flattened. Ergo, long rates need to go up, and I think this has begun to happen slowly. By the end of next year, we could be back at $0.20 and $6.50 a share. If so, it would be a huge win from here.

  • Reply to

    Spinoff

    by dg818 Mar 16, 2015 9:29 AM
    ray858945 ray858945 Mar 16, 2015 10:41 AM Flag

    I suppose that could be true, but I think they've addressed it in another presentation as well. Do I recall correctly? Two mentions would imply more than just an off-the-wall thought.

  • Reply to

    Spinoff

    by dg818 Mar 16, 2015 9:29 AM
    ray858945 ray858945 Mar 16, 2015 10:24 AM Flag

    I believe that since the announcement, we had that huge plunge in interest yields in January. Perhaps that temporarily messed up plans.

  • Reply to

    Just Remember

    by mysonchino Mar 6, 2015 9:47 PM
    ray858945 ray858945 Mar 7, 2015 12:40 PM Flag

    Myson ...

    And let us not forget that the world is hungry for yield right now. I think that once RSO's operation is perceived the way you describe it, we won't have to wait for everything to have been accomplished. Trust will come back, and the yield will go down. A $1.00 divy and a 10% yield, and I make a small fortune .... not only possible, but likely over the next couple of years IMHO.

  • Reply to

    Just Remember

    by mysonchino Mar 6, 2015 9:47 PM
    ray858945 ray858945 Mar 7, 2015 11:48 AM Flag

    Myson ...

    I agree with you except that I believe we'll see better earnings sooner. Thoughts:

    RSO had AFFO of $0.17 in the 4th quarter. I can't think of anything in the 1st quarter that would result in that number going down.

    They stated in the CC that they lost $0.04 in the 4th quarter due to unexpected interest rate changes that messed up their hedging in the RMBS unit. I believe that was a big surprise for everyone, but the 1st quarter has behaved much better overall. Maybe we get another $0.04 this quarter.

    They consummated another major CLO in February which should be very helpful. Plus, whatever else they have done.

    It would be very easy to see an AFFO number north of $0.20 this quarter I like the interest rates climbing a little, just not too fast. I think the divy is back to $0.20 by the second half of the year, and, if everything behaves, we could see $0.25 by the second half of next year. A $1.00 divy = an $8.00 stock ... or, if you're Fred Kane, a $9.00 stock.

  • ray858945 ray858945 Mar 6, 2015 9:00 PM Flag

    New originations would benefit from higher rates.

  • Reply to

    Earnings report

    by stan1736 Feb 25, 2015 6:24 PM
    ray858945 ray858945 Feb 25, 2015 7:15 PM Flag

    The market is still open "after hours." They're not the only ones to wait.

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