Stronger Bottom Lines Could Lead to Larger Dividends From American Capital Agency and Invesco

   It is now the heart of earnings season and investors are feverishly following results from Real Estate Investment Trusts (REITs) in hopes of signs of potential dividend increases. To be classified as a REIT, a company must distribute at least 90 percent of its taxable income to shareholders annually in the form of dividends. The Paragon Report examines the outlook for diversified REITs and provides equity research on American Capital Agency Corporation (NASDAQ: AGNC) and Invesco Mortgage Capital, Inc. (NYSE: IVR). Access to the full company reports can be found at:

www.paragonreport.com/AGNC

www.paragonreport.com/IVR

Several REITs are considered relatively risk free. Mortgage REITs earn their money on the spread between low-interest short-term borrowing and purchasing high-interest long-term securities. Mortgage REITs typically borrow at low rates and lend in the mortgage markets at higher rates, usually by buying mortgage-backed securities. By purchasing bonds guaranteed by the government, analysts argue these companies take on no risk of default, with the principle concern being an interest rate risk.

Hybrid mREITs are moderately riskier as they own mortgage backed securities (MBS) or any debt obligations which do not have an implicit guarantee of the US Federal Government.

The Paragon Report provide investors with an excellent first step in their due diligence by providing daily trading ideas, and consolidating the public information available on them. For more investment research on diversified REITs register with us free at www.paragonreport.com and get exclusive access to our numerous stock reports and industry newsletters.

Earlier this week American Capital Agency announced that it priced a public offering of 37,000,000 shares of common stock for total estimated gross proceeds of approximately $1.0 billion. The company also reported net income for the third quarter of 2011 of $250.4 million, or $1.39 per share, and net book value of $26.90 per share. As of September 30, 2011, the Company's investment portfolio totalled $42.0 billion of agency securities, at fair value, comprised of $38.3 billion of fixed-rate securities, $3.2 billion of adjustable-rate securities ("ARMs") and $0.5 billion of collateralized mortgage obligations ("CMOs") backed by fixed and adjustable-rate securities, including interest-only strips.

Presently AGNC pays an annual dividend of $5.60 for a yield of around 19.6 percent. Invesco Mortgage Capital pays an annual dividend of $3.20 for a hefty yield of around 20.9 percent.

The Paragon Report has not been compensated by any of the above-mentioned publicly traded companies. Paragon Report is compensated by other third party organizations for advertising services. We act as an independent research portal and are aware that all investment entails inherent risks. Please view the full disclaimer at http://www.paragonreport.com/disclaimer

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