Western Asset Mortgage Capital Nails The Quarter – Cautious On 18%

By Michael Terry:

I have been following Western Asset Mortgage Capital Corporation (NYSE:WMC) since the firm IPO in 2012, and have had mixed results. Early on, I had it right stating:

Bottom Line: Western Mortgage capital Corp has positioned the portfolio for rising rates and has turned in a strong initial performance with $ 0.38/ps dividend for 47 days (which, if annualized, equates to a dividend yield of over 13% at current levels). The outlook given by the firm and their positioning for their outlook is rational and their targets seem within reason. The only concern I have is that rates could still fall from here (Europe is not done yet) and NIM could get hit pretty hard. Other than that, the REIT is living up to their potential and warrants consideration by investors.

Since then (8/18/12) the stock’s share price has returned -12% (annualized) while the return with reinvested dividends had been


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