Tag Archives: mREIT

mREIT valuation & interest rate risk

In today’s hunt for yield mREITs seem to be an increasingly popular choice. The sector offers yields in the range of 13%. With even high yield bonds trading down to yields of ~7% an almost doubling of potential yield is compelling. But have investors chased yield too much and what happens if rates change dramatically? Today I want to do a check on the valuation of mREITs in general and look at the potential impact of changing interest rates on the business. First, lets take a look at valuation. I’ve covered mREIT basics on the blog before so if you’re … Continue reading

Posted in Portfolio | Tagged , , , | 4 Comments

Mortgage REIT Q2 2011 dividend announcements

I thought today would be a good day to discuss the recent Q2 2011 dividend announcements from the mortgage REIT (mREIT) companies that I track. Six out of the seven mREITs I follow have announced their Q2 dividends. For my previous posts on mREITs see here. Also, today the fed announced their latest policy decision which also has a potential impact on mREITs. Lets dive in. For Q2 2011 dividends for mREITs with non-agency exposure were reduced. Both CIM and IVR reduced their dividends for Q2. On the agency side dividends stayed the same with the exception of NLY. NLY … Continue reading

Posted in Stocks | Tagged , , , , , , , , , , | Comments Off on Mortgage REIT Q2 2011 dividend announcements

Mortgage REIT economics remain compelling

As I mentioned in this earlier post I think there is an good investment opportunity in mortgage REITs (mREITs from now on). Its one of the the few remaining relatively undervalued sectors in the market and offers a compelling dividend yield of about 16%. In this post I’ll provide a basic economic framework to evaluate REITs and provide valuations for the big cap (>$1B) MLP names I’ll be covering. In my first post on mREITs I described how the companies in this sector make money. Basically, the companies leverage up their equity and invest the funds in mortgage backed securities. … Continue reading

Posted in Stocks | Tagged , , , , , , , , | 14 Comments