AGNC declares another $1.40 quarterly dividend. Dividend payout ratio up to 118%, again.

American Capital Agency Corp. has just declared another $1.40 dividend
payable on January 27th, 2012 to common shareholders of record as of
December 22nd, 2011, with an ex-dividend date of December 20th, 2011.

This will be the 10th consecutive quarterly dividend payment of $1.40.
However, the trend of dividend payout ratio over 100% also continues. financial website shows analyst’s concensus estimates for
AGNC’s 4th quarter earnings at $1.18 per share. If they are right,
then AGNC’s dividend payout ratio will be 118%. They will probably
announce a secondary share offering soon to finance their dividend
deficit. Then the share price will drop again. This has been the
pattern for the last few quarters.

AGNC is not earning enough money to cover their dividend payments at
$1.40 per share. There is a substantial downside risk to your capital
if you buy AGNC at today’s price.

DISCLOSURE – I don’t own AGNC.

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Published in: on December 13, 2011 at 1:38 pm  Leave a Comment  

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