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American Capital Mortgage Investment Corp. Message Board

turbofever 33 posts  |  Last Activity: Jan 29, 2015 1:31 PM Member since: Jun 7, 2012
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  • Reply to

    Did I miss something about SFL?

    by golob.chad Jan 28, 2015 2:32 PM
    turbofever turbofever Jan 29, 2015 1:31 PM Flag

    And let's not forget LNCO, with its great 13-14% yield in the $20-22's. Now with its div cut, it still yields 13-14%. Except of course the stock trades at $10, a 50%+ loss of capital. I'm sure we can all do the math regarding how many years of $1.25/yr it takes to make up an $11+ loss of capital...

  • Reply to

    Sold YHOO...$50.50.....

    by rbgambler99 Jan 28, 2015 12:59 PM
    turbofever turbofever Jan 29, 2015 1:07 PM Flag

    Great timing!! Congrats.

  • Reply to

    OT: yhoo bounce

    by marklibera Jan 20, 2015 6:12 PM
    turbofever turbofever Jan 21, 2015 12:01 PM Flag

    IMO, Yahoo is just following BABA for now. Compare the two on the 5-day. Unless rumors of Marissa's plans for Yahoo are somehow pulling BABA up and down ;)

    However Yahoo acts after the 1/27 ER, be prepared for additional volatility (in either direction) a couple days later on 1/29 (the first day of trade here following BABA's pre-market ER).

  • Reply to

    YHOO and BAC are killing me....

    by rbgambler99 Jan 15, 2015 11:59 AM
    turbofever turbofever Jan 15, 2015 1:34 PM Flag

    I hear ya.. After being treating me well earlier on, BABA has been repeatedly punishing me hard. Take a look at a 5-day chart comparing YHOO and BABA by the way - they're essentially identical. BABA is wagging the YHOO dog, if BABA keeps going down, YHOO will follow.

    I have really got to make a stronger effort each time I enter a new position to define a protective sell-point and stick to it. I'm happy I recently sold off half of my BABA position but most of the big damage was already done.

  • Reply to

    NAO declares

    by bobdbeck Jan 7, 2015 7:55 AM
    turbofever turbofever Jan 11, 2015 1:04 AM Flag

    William, perhaps your mistake is seeing that $10.7m operational cashflow number at the top of page 5 and thinking it was for Q3. If you re-check the heading you'll find it's actually a trailing **9 month** number. NAO specifically states in the Q3 ER:

    Page 1, 2nd bullet: "Operating cash flow was $6.0 million. Adjusted for
    a non-recurring one-time cost, operating cash flow was $7.5million." (Non-GAAP).

    Page 2, 3rd paragraph: "The Company's operating cash flow was $6.0 million in 3Q2014, compared with $7.7 million for 2Q2014. Adjusted for the non-recurring costs, operating cash flow was $7.5m in 3Q2014."

    Our numbers agree that the dividends paid for the *3* months of Q3 are indeed $10.54mil. So NAO is paying out $10.54mil per quarter in div's, and their operating cashflow of around $7.5 million (which already excludes the 1-time $1.5mil IPO expenses) leaves them with a $3+ million shortfall every quarter. That is not a sustainable dividend.

  • Reply to

    NAO declares

    by bobdbeck Jan 7, 2015 7:55 AM
    turbofever turbofever Jan 9, 2015 9:49 PM Flag

    Thanks keebon, always good to know someone else came up with the same numbers & conclusions. Re: Statoil, my memory is fuzzy but didn't they cancel out of some North Sea drilling contracts a few months back?

    Anyways, I agree with your hunch that the div will be maintained but not increased. My worry is more that they would maintain the div as long as possible even if things were getting dicey, and that stock holders could die a much slower death so to speak (ala PSEC, LNCO) as capital gets eroded away by a falling share price.. But frankly the bar isn't so high for NAO to be able to maintain.. Just get 2 of the 4 newbuilds signed up for a decent rate and if they can continue their existing contracts then they can probably tread water with the div until the space gets better. Like you, I could more than live with that div, just as long as I wouldn't find myself losing a lot of capital that would take years for the div to restore...

    Someone post here immediately the moment they catch wind of potential new contracts for NAO ;)

  • Reply to

    NAO declares

    by bobdbeck Jan 7, 2015 7:55 AM
    turbofever turbofever Jan 9, 2015 4:03 PM Flag

    I generally agree but would not cite NAT having paid a dividend for 70 straight quarters as anything that should inspire confidence in management. They spent most of those years steadily reducing their dividend, from what used to be over $1/qtr to an average of just $.15c/qtr for 2014.

    And the stock price has gone from the upper left to the lower right over the past few years too. $30 in 2010, down to around $8 - $10 for 2014.

    For many of the worst years, the CEO would appear on Cramer spouting a jolly, optimistic attitude. Likeable guy, but a total disconnect with the stock's performance.

    One might mistakenly think I'm negative on NAO from some of my comments but honestly I'm just trying to stay as objective as possible. I'm not saying anyone should sell, I just think there's reasons in the current climate that one might want to wait to buy, with the risk of missing a little pop if good news is announced. I only keep room for a few oil stocks in my total portfolio and this could be one of them but only after they've shown me they've navigated the current risks. I'm 4x bitten, 8x shy ;)

  • Reply to

    OT: Major housecleaning

    by marklibera Jan 9, 2015 12:21 PM
    turbofever turbofever Jan 9, 2015 2:22 PM Flag

    One of the lessons I "learned" in 2014 and was also able to then successfully practice particularly with oil, is simply not to try to time bottoms. Specifically, it's better to give up a few percentage by buying on the far side of the U or V curve.

    Oil production does not stop on a dime of course, prior capex spent last year will continue to turn out a lot of oil for a bit, even as new capex budgets are drastically cut. If you didn't catch Cramer yesterday (I think it was yesterday and not Weds), it is worth watching the segment regarding why oil should go lower. Off the top of my head, he cited two companies which recently reported that their new capex budgets are now cut by over 50%, yet they are still projecting 20-30% greater 2015 production than 2014 (!!).

    It's simply going to take more time for this to play out or at least until we can start to feel any confidence about getting back in. It doesn't mean oil prices "have" to get much lower, but it probably means they aren't going to get higher for a while either, so no one is likely to lose much money by getting out and waiting on the sidelines.

    I suppose that was a long way of saying: Though oil sure has gotten low, I suspect your sales will serve you well and that you will have an opportunity to re-buy the stocks lower at some point. Dunno if we hit $30's or not but personally I'd guess low-$40's is in the cards.

  • Reply to

    SDRL.....UGH

    by bobdbeck Jan 9, 2015 1:04 PM
    turbofever turbofever Jan 9, 2015 1:55 PM Flag

    Side note: Now at $1.30's, sadly NADL's stock price is practically an "Option". And to think it wasn't quite a year ago that NADL IPO'ed at $9, and as recently as September was trading at $10.

  • Reply to

    NAO declares

    by bobdbeck Jan 7, 2015 7:55 AM
    turbofever turbofever Jan 9, 2015 12:58 PM Flag

    November Post #1
    It appears the div was set in anticipation of the money coming in from 2015 newbuilds and is not sustainable based on the current fleet. $.45 div/qtr and 23.4 mil shares outstanding = $10.5 mil in divs to pay. Quarterly cashflow (not incl the 1 time IPO expense) is $7.5 mil, a $2.5 mil shortfall.

    At $25k/day, each incoming newbuild should gross $2.25 mil/qtr.

    So after the 2 Jan newbuilds begin contracts, chances are the current div will be shored up. Then, when the next 2 arriving in mid-2015 begin contracts, there's the potential for div expansion (or, should day rates all get nailed across the board on NAO's whole PSV fleet, at the least allow NAO to continue to maintain over 1.0 div coverage)

    #2
    Clean, debt-free balance sheet. 6 contracted ships running, 4 new-builds due in 1st half of 2015. G&A likely to stay in-check even as the fleet size rises. The current div is not sustainable as-is (it is not covered by the revenues from the 6 ships). Instead it was set to take into account the future income that the new-builds will provide. I think if they contracted just 2 of the 4 new-builds, they could cover the div. Contracts for the remaining 2 would add notably extra coverage, possibly even allow a raise. Prior dayrates were ~26k, so keep that in mind when contracts are announced.

    I think the stock is a good bet assuming we don't see North Sea active drilling-rig count dropping. Though these ships don't have to operate in that region, it would work out best if they did. If & when NAO starts announcing contracts for the 2 newbuilds in Jan and then the 2 newbuilds around June, the stock should hopefully climb as the great-yielding div first becomes sustainable, and then looks to be "over-covered". They could alternatively use the extra income to further expand the fleet, obviously that could increase risk though if there are concerns that the number of active rigs in the deep sea drilling market declines and supply ships become too plentiful.

  • Reply to

    NAO declares

    by bobdbeck Jan 7, 2015 7:55 AM
    turbofever turbofever Jan 9, 2015 12:43 PM Flag

    I'll have to disagree. The dividend is not fully covered at this point.

    After this message, I will copy and re-post a message or two I wrote here back in November, since the same questions on NAO seem to continue to come up. The posts seem as true today as they were then. Given we're in January now and so far there hasn't been any announcement of contracts for the 2 incoming newbuilds, each investor needs to decide for themselves if they want to be in before first hearing news re: if this month's newbuilds have landed contracts.

    Personally, I'm playing things very conservatively in the oil space, and for NAO I'm willing to miss out on what I'd guess would be an immediate $1-$2 pop on such news. I'd rather buy a little higher but with confidence that their new supply ships are getting good contracts in this environment, given the lack of demand for utilizing additional deep sea rigs right now and North Sea rigs in particular (the preferred space for their PSV's, though they can operate elsewhere).

    I'd like to get back into NAO, I'm just cautious right now as I don't feel oil & the deep sea market is going to suddenly rebound and stay up. Way too much production still occurring even as capex is starting to fall.

  • turbofever by turbofever Dec 16, 2014 2:06 PM Flag

    Neither here nor there... Just wanted to point out where Google's stock (GOOGL) has sunk to. Down almost 10% year to date, and down 17% from its highs earlier this year. Has dropped 8% just in the past month and is knocking on the door to $400's. Momentum sure seems to have fled from the stock.

    I had been casually/inactively waiting for a good pullback in Googl to start a long-term position. For now I'm not so sure, probably based on the same reasons the stock has been pulling back... I question what they're spending their $$ on (ala Amazon) and wonder how they'll be growing business in the future. Seems like there's better tech picks out there in the meantime on any major market pullbacks.

  • Reply to

    OT: Carter Worth saying to short the SPY

    by marklibera Dec 15, 2014 12:03 PM
    turbofever turbofever Dec 16, 2014 12:25 PM Flag

    I am rarely one to try to time a major bottom any more when something has been getting repeatedly pounded, but if oil actually gets to low-to-mid $40's I would have to force myself to buy. Doesn't seem sustainable long-term especially as production must fall off in the coming year if prices stayed anywhere near that low.

    Enough people in the market probably realize this, which would make me guess that we don't get to see $45 & under. Who knows though.

  • Reply to

    LINE/LNCO popping in A/H

    by bobdbeck Dec 15, 2014 6:34 PM
    turbofever turbofever Dec 16, 2014 10:05 AM Flag

    Agreed, the price action has been horrid. In the case of this morning, interestingly enough both stocks have quickly reversed since market open and swung $.75c+, both in the green now. I'll keep my fingers crossed for those still in 'em.

  • Reply to

    LINE/LNCO popping in A/H

    by bobdbeck Dec 15, 2014 6:34 PM
    turbofever turbofever Dec 16, 2014 9:46 AM Flag

    Yesterday in AH it looked like the Linn stocks might finally catch a break and maybe get some shorts to cover today given these deals going through and Linn being able to pay down a lot of debt... But sadly, no dice so far today.. Perhaps the morning's Baird downgrades (with $10 price targets) are responsible.

  • Reply to

    OT: Carter Worth saying to short the SPY

    by marklibera Dec 15, 2014 12:03 PM
    turbofever turbofever Dec 15, 2014 1:27 PM Flag

    I like Carter & most of the folks on Options Action & Fast Money.. But that said I see very little correlation to C.B.W.'s technical predictions and what actually happens.

    Frankly there's a small part of me that would be happy to see the S&P stay weak through end of December, if just to confirm some basic fundamental philosophies...

    It seemed like every talking head, Cramer, etc all unanimously agreed that the market would run up through the rest of December, with all the under-performing hedge funds trying to "catch up" plus get into names that did well this year to make it look like they were smart money managers... It rubbed me as really wrong that everyone took a Dec rally as a foregone conclusion, and seemed to violate the rule that we tend to get pullbacks when everyone is bullish and thinks nothing can go wrong...

  • Reply to

    PSEC cuts divvy

    by bobdbeck Dec 8, 2014 8:33 AM
    turbofever turbofever Dec 8, 2014 11:39 AM Flag

    I'd hope no one was surprised by this, it's been called out for a while and only the timing was in question. Though I'm actually a little surprised they did it this month, I figured they would keep dragging things out until early next year and then weave it into part of the spin-out plan. I think today's timing wasn't bad though, with the share price already in the high $8's, a lot of the cut was factored in so the pain from the announcement is lessened.

    My sympathies to those who have been holding shares, and certainly today only added to the pain.. But hopefully this is the final round of the stock taking its lumps and in the coming months it can start a true healing process. As a prior shareholder and one who wanted to get back in once they got their act together, frankly I'm happy they went to $.0833c rather than a more shallow cut, though I woulda been better yet with .08c. If a higher div was kept, I think everyone would have been nervously holding their breath on every earnings report, knowing PSEC was walking the razor's edge on covering the div. Confidence needs to be restored to the stock and part of that means seeing quarter after quarter of sustainable earnings (essentially, NII) covering the div w/o relying on one-off transactions.

    For all the complexities of PSEC's business, I continue to consider the stock itself as simple to price. As both a result of the non-qualified divs they pay as well as the risks of their business, PSEC investors traditionally tend to require an 11.5% to 13% return. That puts it into a new range of 7.7 to 8.7. Average that out to avoid the extremes and you come to a 12.25% yield and a $8.16 stock price. Not far from where it's trading now...

    The stock still has a big question to answer around Feb, which is what's happening with all these spinoffs. But there's nothing inherently bad with such a practice (unlike a div cut) so hopefully it will eventually be upside to the stock price.

  • Reply to

    Capitulation

    by huffdaland Dec 1, 2014 11:02 AM
    turbofever turbofever Dec 1, 2014 2:42 PM Flag

    I certainly am (in for the long-haul) in the case of BABA! Owwweeeeee!! :(

  • Reply to

    Will the collapse in oil hurt the pipelines

    by lakeed98 Nov 28, 2014 8:23 AM
    turbofever turbofever Dec 1, 2014 12:52 PM Flag

    I don't remember which US oil co said it today (wasn't a name I follow) but apparently when asked how they planned to navigate through lower oil prices, part of their plan is to renegotiate their pipeline prices down...

  • Reply to

    Capitulation

    by huffdaland Dec 1, 2014 11:02 AM
    turbofever turbofever Dec 1, 2014 12:49 PM Flag

    Until *you* have sold!! ;)

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