The real estate sector was separated from financials, but mortgage REITs didn't go with real estate. The financial sector is fundamentally different from mortgage REITs, and they should not be lumped together. Short-term correlation between this company and the financial sector shows investors trading on emotion rather than fundamentals.
Annaly Capital Management (NYSE:NLY) is a mortgage REIT. Officially, that means NLY is part of the "Financial" sector. Even though a new sector was carved out for equity REITs, the mortgage REITs remain stuck in the financial sector. The problem is that the financial sector doesn't have much in common with the mortgage REITs. Sure, banks loan out money. Is that really all it takes to be fall into the financial sector? Banks could earn more interest income on their excess reserves if the short-term rates were increased. The mortgage REITs would stand to see a higher cost of funds that would squeeze their net interest spreads. That sounds like they have pretty much the opposite desires for action (or inaction) from the Federal Reserve.
Source: Seeking Alpha
Related Articles:
- 10 High-Yielding Dividend Aristocrats Not Afraid to Raise Their Dividends
- 8 Dividend Stocks With A Quick Payback
- 7 High-Rated Dividend Stocks With Above Target Returns
- 4 Dividend Stocks For Healthy and Wealthy Retirement
- 4 High-Yielding Utilities With A Growing Dividends
________________________________________________________________
Subscribe to:
Post Comments (Atom)
Popular Posts Last 30 Days
-
Stocks that offer big dividend yields are often backed by businesses that are going through rough patches and experiencing significant downt...
-
With the calendar turning over to 2019, many of the trends causing the rise in volatility aren’t stopping. To that end, making a calculated ...
-
Many dividend stocks tumbled over the past year, since conservative investors often shift from high-yielding stocks to bonds when interest r...
-
Because we're expected to live longer than those just a generation or two removed from us, we'll need income during our retirement f...
-
This company has become an income machine for investors over the past three decades, thanks in large part to the 132 consecutive dividends i...
-
For the most part, stock market investors love the technology sector. While tech stocks were hit particularly hard during the latest market ...
-
If you want to find good deals this holiday season, forget the department stores. Instead, go to the stock market. Due to the lackluster per...
-
Showing resilience during a tough week was a group of stocks that has not been heard from much in the past two years. A group that has been ...
-
Even though GDP is growing nicely, consumer spending is red hot and unemployment is low, the stocks that are outperforming are all ones we’d...
-
The yield is 9.07%, with 1.14X coverage in Q3 '18. EVA has a $7.4B backlog that's contracted through 2025. Management expects EBITDA...
0 comments
Post a Comment
Post a Comment