Published Thu, 21 Mar 2019 10:54:40 -0400 on Seeking Alpha
This research report was produced by The REIT Forum with assistance from Big Dog Investments.
Investors should be allocating at least some of their portfolio to relatively safe investments.
Preferred shares are usually a great way to get a high yield with less risk than the common stock. AGNC Investment Corp. (AGNC) has 3 great preferred shares. We are going to talk about (AGNCB). The common stock carries a material amount of risk.
Source: The REIT Forum common shares spreadsheet
We cover the mortgage REIT sector and most of their preferred shares. While AGNC’s common stock carries less risk than most peers, they still come with a risk rating of “4” on a scale of 1-5. However, their preferred share comes with a risk rating of 1. AGNC is in the hold range and “Price to Projected Current Book” is 1.05. Our book values are regularly updated by Scott Kennedy.
We regularly cover mortgage REITs in our RapidFire mortgage REIT updates for subscribers of The REIT Forum.
Breaking down why we like preferred equity
The reason we’re steering investors towards preferred equity is the certainty of the dividend, relatively stable price, and their inability to have par value or call value fluctuate.
The preferred shares dividend takes priority over the common dividend. For it to be reduced even a penny, the common dividend must be canceled entirely.
In a bankruptcy, the preferred shareholders would expect to get screwed. However, the mortgage... Read more
|Stock name||Last trade||P/E||Earnings/Share||Dividend/Share||Dividend yield|
|ANNALY CAPITAL MANAGEMENT||8.60||0.0||-3.32||1.20||14.00|
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