Published Thu, 08 Aug 2019 10:53:17 -0400 on Seeking Alpha
This research report was produced by The REIT Forum with assistance from Big Dog Investments.
The mortgage REIT market frequently has periods that should make investors question efficient markets. There are periods where things appear efficient, but there are also some incredible failures and the duration of those failures can be as short as a couple of hours or as long as a few quarters, perhaps even a few years. In our experience, something between the extremes is far more common.
One of the problems the mortgage REIT sector faces is the presence of investors trading on dividend yield with no idea what levels of dividends are sustainable or not sustainable. If those investors create a large enough group to move the market, they could influence a mortgage REIT to trade at an unreasonably high or low price compared to peers.
Remember that prices are still determined by supply and demand, so it is entirely possible for share prices to deviate from the comparable value in other similar companies. To be more precise, it is not only possible, but it is also common and uncovering those discrepancies is a major part of our work.
We invest in the mortgage REIT sector frequently.
When we invest in mortgage REITs, we want to be able to actively manage the position. While preferred shares and equity REITs can be very suitable for buy-and-hold investors, we see a huge advantage to an active approach in mortgage REITs.
We cover our positions in our Monthly Portfolio... 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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