Why ANNALY CAP MGMT/SH (NYSE: NLY) stocks are rising

Free $100 Forex No-Deposit Bonus

ANNALY CAP MGMT/SH (NYSE: NLY), leading player in mortgage real estate investment trusts sector, stock surged 29.21% on April 8th, 2020 (Source: Google finance) and continued its bullish momentum, rising over 8.2% in the pre-market session of April 9th, 2020 (Source: Google finance). The stock’s sector peers have been rallying since the beginning of the week. The stock had fallen lot, though falling interest rates are generally good for mortgage REITs but the main problem has been uncertainty. The recession due to the COVID-19 pandemic is still in its very early stages, and there’s no way to know how long or deep it could be. Further, the short-term borrowing costs have increased as fears about liquidity in the mortgage market have increased recently.

Meanwhile, the company’s portfolio is in strong position with about 93% of the assets at the end of March, 2020 comprised of Agency MBS, which have seen both improved liquidity and valuations due to the supportive actions taken by the Federal Reserve. Since the beginning of the year, including during the month of March, the company has proactively reduced the size of the portfolio to manage the leverage profile. At the end of March 2020, the company’s total portfolio has decreased to approximately $99 billion, compared to $128.7 billion at December 31, 2019, and the repo balance was accordingly reduced to $72.6 billion from $101.7 billion at December 31, 2019.

Moreover, the company anticipates on a preliminary basis the economic leverage ratio to be reduced to between 6.8:1 and 6.9:1 at March 31, 2020, compared to 7.2:1 at December 31, 2019. The company has maintained a strong liquidity position, with cash and unencumbered Agency MBS of $4.6 billion and total unencumbered assets of $7.2 billion, as of March 31, 2020. The company anticipates on a preliminary basis the book value per common share at March 31, 2020 to be between $7.40 and $7.60 compared to $9.66 per common share at December 31, 2019. The company projects that on a preliminary basis the net income (loss) per average common share for the quarter ended March 31, 2020 is expected to be between $(2.40) and $(2.60), compared to $0.82 per average common share for the quarter ended December 31, 2019. The company projects that on a preliminary basis the core earnings (excluding the premium amortization adjustment, or PAA) were expected to be between $0.20 and 0.21 per average common share for the quarter ended March 31, 2020, compared to $0.26 per average common share for the quarter ended December 31, 2019.

Additionally, the company has declared the first quarter 2020 common stock cash dividend of $0.25 per common share to be payable on April 30, 2020.

Copyright © 2020. All Rights Reserved. FXDailyReport.Com
Risk Warning: Trading CFDs is a high risk activity and you may lose more than your initial deposit. You should never invest money that you cannot afford to lose. FXDailyReport.com will not accept any liability for loss or damage as a result of reliance on the information contained within this website including data, quotes, charts and buy/sell signals. Please be fully informed regarding the risks and costs associated with trading the financial markets.