Ellington Financial's Historical Value Creation May Offer Insights Into Its Future Returns

I just had my first article published on Seeking Alpha in over a year and a half!

My most recent article analyzes Ellington Financial, Inc. (EFC), a real estate investment trust, or REIT that invests primarily in mortgage-related assets. In my article, I use the same methodology I've used in the past to analyze companies such as Crédit Agricole Du Languedoc and Sixth Street Specialty Lending to analyze Ellington Financial's historical value creation. By examining the company's net asset value (NAV) growth and annual dividends, I examine whether it might be a high quality company for investment... (Read More)

 

Dynex Capital's Historical Value Creation May Offer Insights Into Its Future Returns

Dynex Capital, Inc. (DX) is a mortgage real estate investment trust, or mREIT. The company invests in mortgage-backed securities, or MBS, securities whose income is based on the performance of pools of mortgages.

I’ve written two recent articles about mREITs Ladder Capital (LADR) and Anworth Mortgage (ANH). Both those articles were written because those mREITs look cheap. Dynex Capital does not look cheap. The company trades at a price to book ratio of 94%. In contrast, Anworth and Ladder have, respectively, P/B ratios a little over 60%. The market certainly seems to think it is a higher quality company than other mortgage REITs, given how much higher its valuation is.

To see if Dynex Capital is a high quality company, we can use the methodology I used in my previous mREIT articles. We can look at how much value the company has historically created for shareholders. This will help us predict the company’s future value creation, and thus the company’s possibilities for future share price growth and dividends. (Read More)