UPDATE: Credit Suisse Initiates Coverage on Javelin Mortgage Investment Corp. with Neutral Rating, $20 PT

In a report published Monday, Credit Suisse initiated coverage on Javelin Mortgage Investment Corp.

with a Neutral rating and $20.00 price target. Credit Suisse noted, “We are initiating coverage of Javelin Mortgage with a Neutral rating and a $20 target price. We see 14% total return potential over the next 12 months coming largely from the dividend but also modest capital appreciation. In order to optimize the pace of deployment of the IPO capital, Javelin will have a larger allocation toward the Agency sector. Over time, and depending on the market opportunities, Javelin will increase its non-Agency equity allocation. By nature of going public in the post-QE3 world, Javelin will have lower returns on assets than many of its mortgage REIT peers. Javelin's ROE will be competitive with the peer group, as JMI will use leverage at the upper end of the peer group, consistent with its sister company Armour.” Javelin Mortgage Investment Corp. closed on Friday at $19.57.