Jul. 26 at 3:50 PM
$NLY I think caution here. I wouldn’t go all in. There are risks . The book value dropping three percent to eighteen dollars and forty-five cents per share is a red flag, tied to mark-to-market losses on their mortgage-backed securities, as rates and spreads have been volatile. Their leverage, around six times, makes them sensitive to funding cost spikes or market downturns, like in two thousand eight when the stock fell forty-five percent from eighteen dollars to ten dollars, or twenty twenty when it hit six dollars and fifty cents. Past rate cuts, like two thousand one to two thousand three, gave a short-term boost but often led to dividend cuts later when margins tightened. With rates potentially dropping, asset values could rise, but a compressed net interest margin—now one-point-zero-four percent—might hurt earnings long-term. The stock’s at twenty dollars and eighty-six cents now, but its history of volatility and dividend cuts in crises makes it risky for a long hold.
