Volatile Markets Send Investors to REITs
March 02 2011 - 11:25AM
Marketwired
With the markets showing signs of volatility this week, investors
are once again looking for safe havens. Investors usually count on
dividend paying stocks during hectic times in the market believing
in the company's security and real earnings power. REITs' ability
to generate this significant capital appreciation is one of the
industry's main allures, as most investors flock to REITs for their
hefty dividends and stability. In fact, most of the success of the
industry in the last year can be attributed to low interest rates.
When interest rates get this low the return on dividends can far
exceed that of bonds. The Bedford Report examines the outlook for
diversified REITs and provides research reports on American Capital
Agency Corporation (NASDAQ: AGNC) and Anworth Mortgage Asset
Corporation (NYSE: ANH). Access to the full company reports can be
found at:
www.bedfordreport.com/2011-03-AGNC
www.bedfordreport.com/2011-03-ANH
Companies such as AGNC earn their money on the spread between
low-interest short-term borrowing and purchasing high-interest
long-term securities. To be classified as a REIT, a company must
distribute at least 90 percent of its taxable income to
shareholders annually in the form of dividends. While this makes
paying its dividend more volatile, given the current economic
conditions, REITs continue to be appealing. Federal Reserve
Chairman Ben Bernanke says that he is prepared to keep rates in the
range of 0 - 0.25 percent for an extended period if the
unemployment numbers don't drop significantly.
The Bedford Report releases regular market updates on REITs so
investors can stay ahead of the crowd and make the best investment
decisions to maximize their returns. Take a few minutes to register
with us free at www.bedfordreport.com and get exclusive access to
our numerous analyst reports and industry newsletters.
Solid profits for a REIT keep those dividend payments stable.
Presently, American Capital pays an annual dividend of 5.60 for
yield of about 19 percent. Anworth meanwhile, pays an annual
dividend of 88 cents for a yield of around 12.3 percent. Recently
Anworth reported core earnings of $25.7 million, or $0.21 per
diluted share, for the quarter ended December 31, 2010, consisting
primarily of $27.1 million of net income less $1.4 million of
dividends paid to preferred stockholders.
The Bedford Report provides Analyst Research focused on equities
that offer growth opportunities, value, and strong potential
return. We strive to provide the most up-to-date market activities.
We constantly create research reports and newsletters for our
members. The Bedford Report has not been compensated by any of the
above-mentioned publicly traded companies. The Bedford Report is
compensated by other third party organizations for advertising
services. We act as an independent research portal and are aware
that all investment entails inherent risks. Please view the full
disclaimer at http://www.bedfordreport.com/disclaimer.
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