Last year, the company paid out total dividend of $1.71 per share. Dividend paid in the 1st and 2nd quarters remained unchanged at $0.40 per share. This was reduced to $0.36 in the 3rd quarter, but increased to $0.55 in the 4th quarter. This year, the first quarter dividend was 0.32 with reduced annualized dividend of $1.28 per share. The firm’s current yield is 11.03%.
Another good REIT company for dividend stock investment is Capstead Mortgage Corporation (NYSE:CMO). It has an annualized dividend of $1.23 and currently yields 10.07%.
Capstead Mortgage Corporation (NYSE:CMO) is a small cap company with market capitalization of $1.17 billion. Last year, the firm posted net income of $163 million with a total revenue of $256 million. While the financials are weaker than Annaly Capital Management, Inc. (NYSE:NLY), it performed better on the trading floor. Its shares growth is 3.4% year-to-date from $11.86 to $12.26 per share as of May 24. Capstead Mortgage Corporation (NYSE:CMO) lost traction for the month of May after generally upbeat for the most part of the year. Month-to-date growth is quite disappointing at -5.7%. But this is part of the cyclical nature of Capstead Mortgage Corporation (NYSE:CMO)’s shares. In any case, the company is still triumphant with positive growth year to date.
Shares of Hatteras Financial Corp. (NYSE:HTS) also have turned in a good performance. Its price gained 5% this year from $24.42 to $25.71 per share. But just like the other REIT stocks with roller coaster share performances, shares hit the peak at $27.59 on April 8, before retreating towards its current price level. Just like Capstead Mortgage Corporation (NYSE:CMO), the month of May saw the biggest decline, losing about 5%.
Hatteras Financial Corp. (NYSE:HTS) is a medium cap firm with market capitalization of $2.5 billion. Its earnings multiple is 7.58, while its return on equity is 12%. Last year, the company reported total revenue of $506 million with a net income of $349 million. The annualized dividend of Hatteras Financial Corp. (NYSE:HTS) is $2.8 per share with current yield of 10.87%. This year, the company paid the first quarter dividend of $0.70 per share on April 19.
Another medium cap REIT with a lucrative yield is Chimera Investment Corporation (NYSE:CIM). Its current yield is 11.25% with annualized dividend of $0.36 per share. Chimera Investment Corporation (NYSE:CIM) has market capitalization of $3.25 billion. During the last twelve months, it posted net income of $137 million.
Chimera Investment Corporation (NYSE:CIM) shares made the biggest gain compared to the four other REIT stocks with ytd growth of 21.5%. It started the year with a closing price of $2.60 per share. It ballooned to $3.16 per share on May 24. This makes it quite attractive in terms of shares growth and dividend yield.
Summary
mREITs are risky due to the high volatility of their market. Unlike other companies with stable dividend history, mREITs’ dividends are generally wobbly. This is because dividends are greatly influenced by fluctuations of interest rates and mortgage defaults.
However, if you invest on the best performing mREIT stocks, you will enjoy higher earnings not just from capital appreciations but also from dividends. Also, the Federal Reserve’s low-interest policy helped to boost mREIT balance sheets. As long as the low-interest rate policy is conducted, I expect the mortgage-backed REITs to perform fine while offering double-digit yields.
The article 5 mREITs With Attractive Yields originally appeared on Fool.com is written by Nur Tarkak.
Nur Tarkak has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Nur is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
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