Hatteras Financial (HTS)

Add a New Bulls Reason Company: Hatteras Financial (HTS) Current price: Headline: (100 character max) Analysis: Cancel 100% agree 8 votes   One of the safer investments in 2009 Top Contributor: Daily Wealth | Created when NYSE:HTS was $24.73 | Edit | History The idea is pretty straightforward. These businesses simply earn the interest "spread" like a bank... But importantly, they're not banks. They don't have teller machines, or buildings, or even many employees. But they do earn an interest spread. So I call them "virtual banks." Right now, these virtual banks are earning a huge amount of money. The government is keeping short-term interest rates low, so these virtual banks can borrow at a low rate of interest. But interest rates on the government-guaranteed investments they buy have still not come down, so they can earn a high rate of interest for a safe investment. We're in the "sweet spot" for virtual banks. They can pay 19% dividends or more in 2009, based on current share prices. And they're all trading at just five times forward earnings! They all trade pretty close to book value, too. (100 character max) Cancel 100% agree 3 votes   16.7%! Top Contributor: Alexander Kirkpatrick | Created when NYSE:HTS was $23.98 | Edit | History A 16.7% yield with relatively low risk is attractive in this market. Rising short-term rates are a risk, but warning signs should be visible to the wary before rates rise. (100 character max) Cancel

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