NLY - Chimera Investment: 10% Yield Dividend Raise 0.42X BV (Rating Upgrade)
2024-06-24 15:55:31 ET
Summary
- Chimera Investment cut its dividend multiple times since FY 2022 and shrunk its portfolio, leading to a significant decline in book value.
- The Federal Reserve is nearing a rate cut decision which would benefit mortgage REITs like Chimera Investment.
- Chimera Investment's recently completed a 1-for-3 reverse stock split and raised its post-split dividend by 6%.
- CIM is a risky, but potentially rewarding, investment for high-risk tolerant investors, especially considering that the 10% yield is supported by earnings available for distribution.
Mortgage REIT Chimera Investment Corporation ( CIM ) has been through a lot since the pandemic. The REIT cut its dividend a number of times, creating uncertainty about the company's book value and resulting in a large discount to BV. However, the Federal Reserve is set to cut the federal fund rate in FY 2024 and by doing so will kick off a series of rate cuts that could benefit the mortgage REIT sector in general....
Chimera Investment: 10% Yield, Dividend Raise, 0.42X BV (Rating Upgrade)