This is from Grant's Dispatch:
"In 1999, the year of one of the worst bond markets on record, Annaly
Mortgage Management generated a total return greater than that produced by
the S&P 500 (22.7%, mostly through dividend income; in contrast, the S&P
achieved 21%, mostly not through dividend income). In recognition of this
feat of asset-liability management, Annaly (NLY on the Big Board) is
currently valued at little more than book value. It yields 17 1/2%.
Obviously, the stock market doesn't care about yield. Also, it is not
inclined to overestimate the ability of Michael A.J. Farrell, 48, Annaly's
chairman and CEO, to duplicate the 1999 result in 2000. Never mind that
Annaly, organized as a real-estate investment trust and launched in 1997, has
managed to dodge every interest-rate, yield-curve and credit bullet shot in
its direction to date. Farrell, who gave the fund the name of the Farrell
family's ancestral castle, calls it a yield factory."
Any thoughts on NLY?
Tom |
