American Capital Agency and CYS Investments Maintain Strong Dividends
September 08 2011 - 8:16AM
Marketwired
The Paragon Report examines the outlook for diversified REITs and
provides equity research on American Capital Agency Corporation
(NASDAQ: AGNC) and CYS Investments, Inc. (NYSE: CYS). Access to the
full company reports can be found at:
www.paragonreport.com/AGNC
www.paragonreport.com/CYS
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 remain
appealing.
Most Mortgage REITs have portfolios made up principally of
mortgages insured by the federal agencies Fannie Mae, Freddie Mac
and Ginnie Mae. They typically borrow at low rates and lend in the
mortgage markets at higher rates, usually by buying mortgage-backed
securities. By purchasing bonds guaranteed by the government,
analysts argue these companies take on no risk of default, with the
principle concern being an interest rate risk. The good news for
REIT investors is that last month the Federal Open Market Committee
announced that they would keep interest rates near zero through
mid-2013
The Paragon Report provide investors with an excellent first
step in their due diligence by providing daily trading ideas, and
consolidating the public information available on them. For more
investment research on diversified REITs register with us free at
www.paragonreport.com and get exclusive access to our numerous
stock reports and industry newsletters.
Presently American Capital Agency pays an annual dividend of
$5.60 per share for a massive yield of around 20.2 percent. The
company reported net income for the second quarter of 2011 of
$177.8 million, or $1.36 per share. Taxable income for the second
quarter was $1.56 per share, or $0.20 higher than GAAP net income
per share for the quarter.
CYS Investments pays an annual dividend of $2.40 per share for a
hefty yield of around 18.9 percent.
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