When it appeared that the Fed might dump (sell) its hoard of MBS, investors in the Mortgage REITS like NLY worried that would have driven the value of its MBS portfolio as interest rates would rise.
That fear has subsided now that Dr. Bernanke is saying things like, "We're quite comfortable that we can exit
Looking at the five-year chart below, you'll most likely conclude that now may be a good time to consider owning shares of NLY. You might want to "scale in" and do some Jim Cramer-style "schnitzeling." Keep in mind that NLY has already lowered its dividend due to "yield compression." Up to now that's impacted its trailing twelve month "cash dividend payout ratio", which I expect will improve.
With a yield-to-price of 15.8% and its cash dividend payout ratio so low (technically quite comparable to NLY's payout ratio), yield-chasing investors may prefer AGNC, although we can't rule out an unexpected dividend decrease. Both NLY and AGNC don't report earnings until April 29.
Check Out Our Best Services for Investors
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Model portfolio
- Stocks trading below $10
- Intraday trade alerts