Bank of America Maintains Neutral, $16 Target on Invesco

Bank of America reiterates its Neutral rating and $16 target price on Invesco Mortgage Capital

as it sees the buybacks as protecting company book value at the expense of earnings. BofA says, “IVR rose 2.1% after it announced the Board authorized a 7M share buyback and that BV was roughly unchanged quarter to date, recouping some of the 8% loss witnessed from December 8th when IVR reduced it dividend to $0.65 per quarter. IVR would likely rather invest capital than buy back stock, in our view, suggesting the buyback plan is more of a market signal than a real threat. Still, the specter of buybacks likely encouraged some short-covering, helping today's rally.” IVR closed at $14.80 per share on Tuesday.