UPDATE: J.P. Morgan Raises PT on MFA Financial from $7.00 to $7.50
J.P. Morgan reiterated a Neutral rating on MFA Financial (NYSE: MFA) and raised its price target from $7.00 to $7.50.
J.P. Morgan commented, “Yesterday, MFA Financial reported 2Q12 core EPS of $0.21 (vs. our $0.24 estimate). Key points include: (1) NIM narrowed to 2.87% (-9bps Q/Q.) (2) NAV fell -$0.04 to $7.44 in 2Q12, but asset values appear to have rebounded since quarter-end, (3) Swap roll-offs should incrementally lower hedging/funding costs over the next several quarters. While MFA has built a balanced agency/non- agency portfolio, the recent surge in MBS pricing has created margin pressure. As a result, we believe the quarterly dividend will be cut by $0.01 to $0.02/share over the next few quarters.”
MFA Financial closed at $7.81 on Monday.
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