UPDATE: Stifel Nicolaus Initiates Western Asset Mortgage Capital with Buy, $22 PT on Focus, Discount and Yield

Stifel Nicolaus initiates its coverage on Western Asset Mortgage Capital

with a Buy rating and a price target of $22. Stifel Nicolaus notes, "We like the pure agency MBS focus, the valuation discount (6%) to book value, and the projected dividend yield (14% in 2H12+) of WMC. We also view the active portfolio management strategy and expected emphasis on the 30-year fixed market providing some differentiation from peers. …While most of its peers tend toward buy and hold portfolio strategies, WMC has indicated it anticipates a more active approach to adjusting portfolio composition as opportunities change." WMC closed at $18.52 on Friday.