Housing
Annaly Downgrade Highlights Mortgage REIT Sector Risks Ahead (NLY, MORT)
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Source: Jon Ogg
Today’s move follows a big gap up in the stock on Wednesday because shares closed at $16.11 on Tuesday despite another dividend cut. The new dividend is only at $0.55 per quarter, down from $0.57, $0.60, and $0.65 in the sequential quarters before. Now the dividend yield is “only” 13.5% on a static basis.
What makes this call so interesting is that Annaly is often considered the best or one of the best in the field of REITs which are actually buyers of mortgage-backed securities on a leveraged basis. A rise in long-term interest rates could have a very adverse impact on the portfolio of its mortgages.
The Market Vectors Mortgage REIT (NYSE: MORT) ETF is down only 0.3% at $25.17 on this volume.
JON C. OGG
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