American Capital Agency 25% Undervalued, Cheap In Service Sector

(kfas)

By Takeover Analyst:What follows is a list of office retailers with strong upside. In my view, these three stocks are heavily discounted to intrinsic value due to an irrational level of risk discounting. While future streams of free cash flow are usually discounted above 10% for financials and high-risk ventures, it appears that these typically safe stocks are similarly discounted. In the long-term, there is little reason why the multiples of these three companies should be below 10x.

By Bear Fight:Investors have been attracted to mortgage REITs including American Capital Agency (AGNC) due to their strong dividend yields. The majority of mortgage REITs trade around book value, thus investors need to understand the specific strategies that each manager deploys. AGNC is an agency focused mortgage REIT, meaning they investment in securities that have an implicit government guarantees.

By Takeover Analyst:What follows is a list of regional banks with various degrees of upside. I find that financials, in general, are substantially undervalued due to an irrational amount of risk discounting after the economic decline. Value investors willing to think above this low bar are in a strong position to benefit from higher returns when multiples and profits normalize. These three companies highlighted below all have impressive fundamentals and more reliable earnings than what the markets appreciate.

By Takeover Analyst:What follows is a list of companies specialized in basic materials that have varying degrees of upside. They cover multiple industries: gold, silver, and lumber. Some firms, like Weyerhaeuser, face significant uncertainty while others have limited downside. Still others are appropriately valued by the market. I find myself most bullish about Barrick Gold due to inflationary fears, the company's strong brand, and low multiples complemented by minimal volatility.

By Patricia Moses: In an earlier article, I wrote about the iShares FTSE NAREIT Mortgage Fund ETF (REM) as a good way to generate income in an environment where interest rates are low, and yields on investment grade bonds are quite possibly at long-time lows. In that article, I mentioned the two largest holdings within the REM but went on to describe the benefits of investing in the ETF.

By Qineqt:Residential REITs

By Bear Fight:Investors have been attracted to mortgage REITs including American Capital Agency (AGNC) due to their strong dividend yields. The majority of mortgage REITs trade around book value, thus investors need to understand the specific strategies that each manager deploys. AGNC is an agency focused mortgage REIT, meaning they investment in securities that have an implicit government guarantees.