Annaly Capital Management (NLY) is the largest mortgage REIT listed on the NYSE. With a market capitalization of over $15.5 billion, the company dwarfs almost all others in the sector. In line with REIT legislation, the company pays out 90% of its REIT earnings by way of dividend, and since coming to the market in 1997 has paid out over $7 billion in dividends to shareholders.
NLY shares are currently trading around $16.25, and the mean 12 month price target from analysts researching the stock is $17.53 (8% upside potential). This stock is trading below its 50-day exponential moving average of $17.76, and its 200-day exponential moving average of $17.71. The move below these averages first happened in mid September, as news that the SEC is considering tighter regulation, in line with other investment companies, reached the market. Since then the share price has recovered from the immediate aftermath of the announcement though has proved reasonably volatile.
Earnings per share for the 12 months to end December 2011 are expected to be $2.51, though expected to fall over the following 12 months to $2.30. The shares trade on a trailing price to earnings ratio of 11.87, and a forward multiple of 7.02. The trailing ratio compares to the industry average of 12.64, and the forward multiple is comparable to those of competitors Capstead Mortgage Corp (CMO) and Redwood Trust (RWT), at 7.85 and 9.61, respectively.
For investors looking at dividend paying stocks, NLY’s payment of a dividend of $2.40 last year gives the stock a yield of 14.90%. To continue reading, click here