Ellington Financial deals in the very same products that nearly brought down the entire financial sector. Scarry proposition? Wait until you see the numbers. And, keep in mind that there are so many regulations in place now that it would be nearly impossible to do the same kind of mistakes that were made nearly a decade ago.
The performance of Ellington Financial LLC in the marketplace will significantly impact your decision to invest in its stock. Revenue growth, profitability, competitive positioning, management quality, and industry trends can influence Ellington Financial's
stock prices. When investing in Ellington Financial, there are several factors to consider and potential outcomes to expect. As a company performs well, its stock price may increase, allowing investors to benefit from price appreciation. However, Ellington Stock can experience significant price fluctuations due to market conditions, economic factors, industry trends, or company-specific news. This is why investing in stocks such as Ellington Financial carries risks, including the potential for capital loss. Stock prices can decline, and investors may incur losses if they sell shares at a lower price than their initial investment.
And What about dividends?
A dividend is the distribution of a portion of Ellington Financial earnings, decided and managed by the company's board of directors and paid to a class of its shareholders. Note, announcements of dividend payouts are generally accompanied by a proportional increase or decrease in a company's stock price. Ellington Financial dividend payments follow a chronological order of events, and the associated dates are important to determine the shareholders who qualify for receiving the dividend payment. Ellington one year expected dividend income is about USD1.25 per share.
At present, Ellington Financial's
Dividend Paid And Capex Coverage Ratio is projected to slightly grow based on the last few years of reporting.
Investing in dividend-paying stocks, such as Ellington Financial LLC is one of the few strategies that are good for long-term investment. Ex-dividend dates are significant because investors in Ellington Financial must own a stock before its ex-dividend date to receive its next dividend.
This type of analysis is very useful when you want to generate a past dividend schedule and payout information for Ellington Financial. Then that information in the form of graph and calendar can be used to fully explain how Du Pont dividends can provide a real clue to its valuation.
How important is Ellington Financial's Liquidity
Ellington Financial
financial leverage refers to using borrowed capital as a funding source to finance Ellington Financial LLC ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Ellington Financial financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Financial leverage can amplify the potential profits to Ellington Financial's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of Ellington Financial's financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets). Please check the
breakdown between Ellington Financial's total debt and its cash.
What do experts say about Ellington?
Stock analysis is a method for investors and traders to make buying and selling decisions. By studying and evaluating past and current data, investors and traders attempt to gain an edge in the markets by making informed decisions.
Analysis ConsensusWhat is driving Ellington Financial Investor Appetite?
Ellington Financial is a company that acquires asset-backed financial instruments. This is exactly the kind of product that got the entire financial world into trouble in 2008. So, how could I possibly even consider analyzing a company that works with that product? Simple: This company works with the same kinds of products that created the financial crisis.
While I would equally be apprehensive to consider adding the product into my portfolio, the sector in the industry has been beaten down so much that it is impossible to even consider not looking at the sector. There is barely any interest in any company dealing with these products. There is absolutely no surprise there. That, however, is exactly the reason to get in to the sector.
Here are the company’s numbers for you to consider, including gross revenue, net profit and earnings-per-share, respectively:
2011: $63.5 $10.3 -$0.50
2012: $63.9 $97.1 $1.32
2013: $85.7 $79.4 $3.35
2014: $93.5 $59.9 $2.28
2015: $101.8 $38.4 $1.31
The biggest concern I have with this is the increase in the revenue, but subsequent drop in earnings. Seems the two should be going hand-in-hand. However, there is not a linear relationship there. There is also an interest expense, the company pays on a spread. Despite the drop over the past year, 2016 numbers are looking to be moving higher. That will translate into the improvements in the earnings per share department.
Also, the stock is trading at just above 10-times earnings. This is a level that I look for when I want to add something to my portfolio. By doing this you are looking at buying in to future earnings at a 10% return. But, the entire equity market is, on average, well roughly 25 times earnings. That is well above historical levels of an average of 15 times earnings. Getting in to stocks at the price-to-earnings ratio invites more risk than, say, buying in to the market at a much lower ratio. With a stock trading at 20-times earnings you are only buying in at 5% return. However, the stock market is averaging a return of about 4% with the ratio so high.
The fact that the rest of the stock market is trading at such a high ratio is exactly what attracts me to this stock, and, for the record, I am looking for more just like it. With the ratio so high, investors are going to have to really dig to find opportunities. There is cashflow coming from this stock. Investors are going to be looking for that. Plus, the revenue continues to improve, and with that earnings will do the same. Then, there is the economy in general which is expanding, providing more opportunities for this company.
It is natural that a company that deals in a product that was the cause of the Great Recession would be left aside. No one wants to potentially, get into a company they may feel could potentially do a repeat. But, there is so much regulation making it nearly impossible to create another situation similar to the last financial crisis. Plus, no company would dare put themselves in the same place. Simply, there is much greater scrutiny now.
I have been searching around the market to find these passed over opportunities. They exist and they have a lot of potential. You would want to get into these companies quickly because eventually the rest of the world is going to be finding these stocks as well, and they will be purchasing them. That will push up the price, putting you in a position to create significant wealth for your portfolio.
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David Taylor is a Senior Member of Macroaxis Editorial Board - Sector Analysis. David is a professional writer who writes for multiple investment news outlets. His primary focus is dynamic movements in financial markets and effects of economic volatility on North American industries and sectors. David has many years of experience in financial service industry including working with major banks as a FX trader. In his free time, he does a lot of outdoors type activities including rock climbing, mountain biking, hiking, mountaineering and kayaking in the summer, and snowboarding in the winter.
View Profile This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and David Taylor do not own shares of Ellington Financial LLC. Please refer to our
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