4-Star Stocks Poised to Pop: Chimera Investment

Before you go, we thought you'd like these...
Before you go close icon

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, mortgage REIT Chimera Investment (NYS: CIM) has earned a respected four-star ranking.

With that in mind, let's take a closer look at Chimera's business and see what CAPS investors are saying about the stock right now.

Chimera facts

Headquarters (Founded)New York (2007)
Market Cap$2.71 billion
IndustryMortgage REIT
Trailing-12-Month Revenue$614.1 million
ManagementCEO Matthew Lambiase
CFO A. Alexandra Denahan
Trailing-12-Month Return on Equity17.8%
Total Debt$6.2 billion
Dividend Yield19.7%
CompetitorsAnnaly Capital Management (NYS: NLY)
Capstead Mortage (NYS: CMO)
MFA Financial (NYS: MFA)

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 96% of the 1,175 members who have rated Chimera believe the stock will outperform the S&P 500 going forward. These bulls include ballengerm and Speachless.

Just last month, ballengerm tapped Chimera as a particularly timely income opportunity: "Including dividends, this stock will outperform until 2013 when the Fed expects to raise interest rates. Cheap now too."

In fact, Chimera currently boasts a whopping dividend yield of 19.7%. That's higher than that of other mortgage REITs like Annaly (14.9%), Capstead (14.1%), and MFA (14.5%).

CAPS member Speachless elaborates on the Chimera bull case:

Buying this stock for the dividend. It is less highly leveraged than its peers in the REIT type business. Does non-conforming rather than sub-prime loans. I think the demand for those loans will continue to rise. I think that the Fed has let the horse out of the barn by saying interest rates will stay low for the next few years. I wish I had their crystal ball! Mine is still pretty cloudy, but since they control interest rates and that is the interest rate spread that makes Chimera money, so be it, let's make some money.

What do you think about Chimera, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!

Interested in another easy way to trackChimera?Add it to your watchlist.

At the time this article was published Fool contributor Brian Pacampara owns no position in any of the companies mentioned. The Fool owns shares of Chimera and Annaly. Try any of our Foolish newsletter services free for 30 days.We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.

Copyright © 1995 - 2011 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Want more news like this?

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

From Our Partners