NRZ announced a 46c quarterly dividend payable in Jan. Down more than that today though at 11.12, a new 52 week low.
New Residential Investment Corp. (NYSE:NRZ) (“New Residential” or the “Company”) announced today that its Board of Directors declared a quarterly dividend of $0.46 per common share for the fourth quarter of 2015. The dividend is payable on January 29, 2016 to shareholders of record on December 31, 2015.
Michael Nierenberg, Chief Executive Officer of New Residential, commented, “The $0.46 per share quarterly common dividend announced today represents our ongoing commitment to deliver strong and consistent dividends for our shareholders. Looking ahead into 2016, we remain confident in the strength of our business and remain focused on generating attractive returns and maximizing shareholder value.”
ML/BofA did maintain its buy rating but lowered its target to $15 from 20.
Still room for upside, but tempering our view We are reducing our Price Objective for NRZ to $15 from $20, as the market will likely
continue to value mortgage REITs using a relatively high dividend yield requirement, in
our view, given concerns for dividend sustainability in the face of rising interest rates,
wider spreads and changes in investment strategy. We remain constructive on NRZ and
its ability to produce attractive risk-based returns from its portfolio MBS and mortgage
servicing-related investment, though we recognize its eclectic collection of assets leads
to reduced visibility and weaker sentiment. NRZ's rotation into alternative assets (NPL's
and Servicer Advance bonds) that markets have less experience with generally supports
this line of thinking. However, with over 60% of assets invested in MSR-related assets,
NRZ should be positively geared to increasing interest rates. NRZ is currently valued at
a 15% distribution yield, which we think is sustainable for the foreseeable future, with
potential capital appreciation, which warrants a Buy rating, in our view.
