Cantor Fitzgerald Maintains a 'Buy' on Capstead Mortgage (CMO); Solid Quarter, with Higher Prepayments, but a Muted Prepayment Outlook

Cantor Fitzgerald maintains a 'Buy' on Capstead Mortgage (NYSE: CMO) price target lowered from $13 to $12.50.

Cantor analyst says, "Capstead reported 3Q:11 EPS of $0.43, versus its 3Q:11 dividend of $0.44 (down from $0.48 in 2Q:11). In our view, it was a solid quarter...Management expects neither the expanded HARP program nor lower mortgage rates to have a material effect on its prepay speeds, because (a) of a maximum LTV of 105% on ARM-to-ARM refis under HARP, (b) Capstead does not have a material amount of recent-vintage RMBS (with credit-worthy borrowers), and (c) Capstead's borrowers already have an average mortgage coupon rate of about 3.6% (so that refinancing in order to lower monthly payments is difficult)."

For more ratings news on Capstead Mortgage click here and for the rating history of Capstead Mortgage click here.

Shares of Capstead Mortgage closed at $12.15 yesterday.

---

Serious News for Serious Traders! Try StreetInsider.com Premium Free!

---

You May Also Be Interested In

• Intuitive Machines Inc. (LUNR) PT Lowered to $32 at Cantor Fitzgerald, Reaffirms Overweight Rating
• Cantor Fitzgerald Downgrades Better Home & Finance Holding (BETR) to Neutral
• UBS Reiterates Buy Rating on Hilton Worldwide (HLT)