Annaly Capital Management
Core earnings per share for the quarter -- excluding impairment charges, and gains and losses on security sales and interest rate swap terminations -- increased to $0.26 from $0.16 last year. The company also completed the largest capital raise in its history, and CEO Michael Farrell announced that Annaly expects to invest all of the proceeds in the coming quarter.
These days, the mere mention of the word "subprime" gives investors the jitters. Annaly competitor Impac Mortgage Holdings
As a result, Annaly's job is to manage interest rate risk, and the company did a good job of that in the past quarter. The annualized yield spread (the difference between what Annaly earns on its assets and what it pays on its liabilities) increased 26 basis points over the prior-year period, to 0.58%, and increased 9 basis points over the previous quarter, which helped the company keep the run-rate dividend yield at a healthy 5%.
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Fool contributor Emil Lee is an analyst and a disciple of value investing. He doesn't own shares in any of the companies mentioned above. Emil appreciates your comments, concerns, and complaints. Fannie Mae is a Motley Fool Inside Value recommendation. The Motley Fool has a disclosure policy.