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Two Harbors Investment Corp. Message Board

sonnenwayne 7 posts  |  Last Activity: May 23, 2016 3:43 PM Member since: Sep 26, 2009
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  • Reply to

    AARC to Buy American Capital!

    by igurumo May 23, 2016 8:04 AM
    sonnenwayne sonnenwayne May 23, 2016 3:43 PM Flag

    That's pretty much why the Bloomberg article "Ares Capital Deal Deserves Cheers, Not Jeers" was written.

    I did not dial into the conference, but when I get time I will carefully read the transcript. If the dividend is that much more stable then a bounce back is expected. There were other bidders for these assets, but paying 85 cents on the dollar, half of which will be in the form of ARCC stock, does not sound like they overpaid. Management will benefit, no doubt about that. But as long as I get something out of it, I won't complain. Of course results are yet to be seen... and this won't close for months.

  • Reply to

    Repost on current analyst coverage:

    by bacon2bacon Mar 21, 2016 4:58 PM
    sonnenwayne sonnenwayne Mar 21, 2016 5:43 PM Flag

    All that is nice to know, but the big one: What does Jim Crammer say? LOL

  • Reply to

    TWO cuts it's dividend

    by bobdbeck Mar 15, 2016 8:14 PM
    sonnenwayne sonnenwayne Mar 17, 2016 1:40 PM Flag

    The 23 cent dividend was announced over a month ago -- in their February 3 earnings release. It was clearly highlighted in a section titled 2016 Dividend Outlook:
    "The company expects to issue a dividend of $0.23 per share for the first quarter of 2016, subject to approval by its Board of Directors. The company anticipates that a quarterly dividend level of $0.23 per share will be sustainable for the year."

    TWO does invest in MSRs and is building that platform, but it's much more diverse and subject to far less regulation risk. Comparing TWO to NRZ is not apples-to-apples and as a long-term investment, I have less worries with TWO's business model than that of NRZ. I own both, but I would not sell TWO and put that money here. MSRs look good for the immediate future, but as we all know things can change quickly -- especially if/when regulators want to make an example out of large mortgage services (mainstream politics).

    Not sure why NRZ is not trending up a little, but I suppose that only reinforces the notion of how stupid some of this "market" is. If they announced the 46 cent dividend tonight, then tomorrow would see upward movement, and that upward movement will only increase the more it finishes down today. Basically, not too smart to be selling today...

  • sonnenwayne sonnenwayne Mar 1, 2016 1:56 PM Flag

    In that same article, I see two possible connections to NRZ/NSM. First is the servicing practices and related fees that are not being questioned. At present, this appears to be exclusive to OCN. There is always the risk that it leads to more industry-wide changes, but then you open the door to affecting everyone -- including banks. My two cents is that this remains limited to OCN.

    The second is that NRZ is contracting out some servicing to OCN. If OCN looses its servicer license, then NRZ will need to move those to some place else. I don't know how much of NRZ's mortgage servicing is contracted through OCN. I trust that NRZ/NSM/FIG will do what they need to distance themselves from OCN -- if that is what is needed. On the latest call, WES did say that they were comfortable with their relationship with OCN and NSM. Obviously that may have just changed. How much servicing is done through OCN and what would that cost to be moved somewhere else?

  • Reply to

    Just a fund changing its investment model. It will

    by hneiman Mar 1, 2016 11:29 AM
    sonnenwayne sonnenwayne Mar 1, 2016 12:07 PM Flag

    Yep -- OCN had bad earnings and is not moving away from mortgage servicing and getting into auto loans. So all mortgage-service related stocks take a hit? Regardless of how smart (or not) that is, it looks like NRZ is unaffected from a fundamental perspective.

  • Reply to

    Was a little discouraged today..

    by notalllivesmatter Mar 1, 2016 10:04 AM
    sonnenwayne sonnenwayne Mar 1, 2016 12:02 PM Flag

    I did a Google Search and the explanation I get can be seen in "Why Ocwen Financial Corp. Is Plunging Today." OCN had bad Q4 earnings with big losses. And now OCN is diversifying away from mortgages and getting into auto loans.

    if that's all this is about then "No worries."

  • Reply to

    Was a little discouraged today..

    by notalllivesmatter Mar 1, 2016 10:04 AM
    sonnenwayne sonnenwayne Mar 1, 2016 11:58 AM Flag

    What issues are affecting OCN to cause a 40% drop in pps -- and volume increase by 1000%?

    The cross-over effect to NSM/NRZ and others could be a knee-jerk reaction, but if this is dues to some kind of proposed regulation change, then we have a different story.

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