Compass Point Downgrades American Capital Mortgage (MTGE) to Neutral; Taking Some Off The Table

Compass Point downgraded American Capital Mortgage (NASDAQ: MTGE) from Buy to Neutral with a price target of $23.00 (from $20.00).

Analyst, Jason Stewart, said, "Since initiating coverage on MTGE with a Buy rating on November 10, 2011, shares have returned 57.0% (total return including dividends and capital appreciation) versus a total return for the BKX of 19.9%. Over the near term, we expect an increase in prepayment speeds (both through increased regular way refinancing and an increasingly effective HARP 2.0 program) to have a modest negative impact on the net interest spread of MTGE's portfolio. With MTGE currently trading at 114% of 1Q12 BVPS (112% of our projected 2Q12 BVPS) we believe that the risks versus rewards are balanced."

For an analyst ratings summary and ratings history on American Capital Mortgage click here. For more ratings news on American Capital Mortgage click here.

Shares of American Capital Mortgage closed at $24.81 yesterday.

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