posted
ECRO-10c cash Divi on a 18c stock, was NYSE stock -------------------------------- Thursday, February 28 2008 9:00 PM, EST
ECC Capital Corporation Announces Common Stock Cash Distribution of $0.10 Per Share
PR Newswire "US Press Releases "
IRVINE, Calif., Feb. 28 /PRNewswire-FirstCall/ -- ECC Capital Corporation (OTC: ECRO), a mortgage finance real estate investment trust, announced today that its Board of Directors has declared a cash distribution of $0.10 per share of common stock. ECC Capital will make this distribution on Friday, March 21, 2008, to shareholders of record on Friday, March 7, 2008.
ECC Capital recently received approximately $9.5 million from the release of over-collateralization proceeds related to the Encore Credit Receivables Trust 2005-1. The fact that ECC Capital received this distribution is not an indication that it will receive any additional distributions from any of its securitization trusts or, if it does receive a distribution, that those proceeds will be distributed to shareholders. The circumstances of the over-collateralization release from the 2005-1 trust were specific to that trust. These circumstances include, but are not limited to:
-- This trust had more time to season prior to the deterioration of the lending and housing markets than the Encore Credit Receivables Trust 2005-2, 2005-3 and 2005-4 (the "Remaining Trusts"); and
-- The losses and delinquencies for the 2005-1 trust were lower than the Remaining Trusts at comparable ages.
ECC Capital continues to experience higher levels of delinquencies and losses on mortgage loans held for investment in its securitization trusts and deterioration in the housing market. Therefore, ECC Capital cannot guaranty it will receive any additional over-collateralization proceeds. The amount and timing of any over-collateralization released from any securitization trusts depends on, among other things, the applicable delinquency and credit loss limits specified in the securitization agreements and loan performance in those trusts. Further, ECC Capital has repeatedly cautioned about the uncertainty of any future distributions to shareholders due to future capital requirements, the adverse, changing and unpredictable environment in which it operates, the continued deterioration of the lending industry and capital markets and the subsequent adverse effects these factors have on ECC Capital's loan portfolio.
Although ECC Capital has issued press releases in the past, in an effort to reduce costs and because of reduced staff and limited operations, ECC Capital limits its use of press releases. Please periodically check ECC Capital's website for information. You may also contact ECC Capital using the toll free number of 866-338-8749 or via email at investorrelations*ecccapital.com.
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posted
Looks nice to me but what do I know.I bought in and is probably my only stock showing green today.I hope their distibution news wasnt just a smoke screen to get suckers like me to buy stock then issue another release stating that they have changed their minds.TDWV did that to me late last year.
posted
The key here is to try and figure out if the PPS will rebound after the Dividend is paid.
You have to remember that the 10 cents you receive will automatically be subtracted from the PPS. So it will open 10cents lower the day after the Ex-date.
This could also get tricky. If it ends up that the Divy is worth 25% or more of the PPS the following rule will apply.
Dividends Or Distributions 25 Percent Or Greater Than Security Value
The second method, under subparagraph (b)(2) of Rule 11140, provides that for dividends or distributions that are 25 percent or greater of the value of the subject security, the ex-date shall be the first business day following the payable date. For example, if an issuer has announced August 10 as the record date and August 31 as the payable date, then the ex-date will be September 1, the first business day after the payable date. In this example, September 1 is the day on or after which a buyer would purchase the security without the dividend and, therefore, the day on which the price of the stock is adjusted downward. In this example, a seller of the security on August 15, even though the holder of record to receive the dividend, would have to relinquish the dividend to the buyer. Indeed, because the value of the security on August 15 has not yet been adjusted downward to reflect the dividend distribution, the seller in this example would be unjustly enriched by keeping the dividend. The seller would have received the value of the dividend twice: first, as fully reflected in the unadjusted price of the stock on August 15; and secondly, as subsequently paid by the company to record date holders.
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posted
Tex, not sure what the play would be, can you explain? pretty sure wally's posted rule eliminates any possibility of being able to get paid and sell the stock at pre-div price.
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posted
didn't we go through this with another one? TLHO, maybe?
doesn't matter, those theoretical write-ups. Rule 11140 explains it best:
quote:UPC Rule 11140 governs the designation of ex-dates for securities. The ex-date is the date on or after which a security is traded without a specific dividend or distribution. The payable date is the date that the dividend is sent to the record owner of the security.
Remember another one like this, and you said sumpin like, "well, yeah...but you could also just go ahead and buy it again, with your own money" ?
Anyway, read 11140; is pretty clear that no matter what the theoretical "model" for setting dates, NASDAQ/FINRA ultimately sets the ex-date.
Possibility exists that peeps will sell off between pay date & ex-date, for whatever reason, not realizing they're ditching the due bills *and* their cash, too...
If so, pps/divvie ratio might become attractive...
-------------------- Nashoba Holba Chepulechi Adventures in microcapitalism...
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Wally, I get Tex's point now. Basically here's the deal. Buy $5,000 worth of stock. Get $2,500 dividend BEFORE ex-date (i.e., you get paid, but if you sell the shares, you have to pay that person the dividend), so some people can use that $2,500 to but $2,500 more stock, and get $1,250 more dividend. My point to him was, why don't you just buy $7,500 worth if that's what you want to do, to eliminate any room for screw ups.
quote:Originally posted by wallymac: No need to try and figure this out. Here's the real dope straight from the OTCBB Dividend Search.
ECRO - ECC Capital Corp. comm stock Declaration Date:
posted
For the record, be careful here, as these are the plays that bent me over on my taxes this year.
For those who didn't see the thread, I made about $25,000 in dividends on these, but "lost" $22,000 in stock (I already forget the exact numbers...), and the gov't treats div and stock separately.
Example:
Buy $20,000 of this stock at .20 Get $10,000 dividend Sell stock at .15 Net, you make $5,000
But taxes work this way:
Pay taxes on $10,000 dividend Have capital loss of $5,000 Can only have $3,000 of capital losses to offset income, so you pay taxes on $2,000 that you didn't really make.
Two things about it though. If you have enough other gains to offset the "stock" loss, you're okay, and even if not, you get to carry the capital loss over to the next year.
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Over 55% gain right now with div. if this thing drops much more I would be suprised $.15 would be the lowest I seen one other stock that gave a cash dividend and it ended up going over $1 not sure if this will do the same.
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quote:Originally posted by joeyisthebest: Over 55% gain right now with div. if this thing drops much more I would be suprised $.15 would be the lowest I seen one other stock that gave a cash dividend and it ended up going over $1 not sure if this will do the same.
posted
No, basically whoever owns on the 7th "gets" the dividend, but then they have to give it to whoeveer they sell to, if they sell before the 21st or whatever.
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quote:Originally posted by PCola77: Wally, I get Tex's point now. Basically here's the deal. Buy $5,000 worth of stock. Get $2,500 dividend BEFORE ex-date (i.e., you get paid, but if you sell the shares, you have to pay that person the dividend), so some people can use that $2,500 to but $2,500 more stock, and get $1,250 more dividend. My point to him was, why don't you just buy $7,500 worth if that's what you want to do, to eliminate any room for screw ups.
quote:Originally posted by wallymac: No need to try and figure this out. Here's the real dope straight from the OTCBB Dividend Search.
ECRO - ECC Capital Corp. comm stock Declaration Date:
There's that, for sure...using "their money." But also, let's say it drops on pay date to *below* divvie price. Not saying it will--just something to monitor...especially with a lot of confused peeps trading it, apparently...
-------------------- Nashoba Holba Chepulechi Adventures in microcapitalism...
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posted
In other words, to use the amounts from your example, PC, one might enter at $5k without tieing up $7.5k...then see what develops. For example, that "extra" $2.5k you didn't use to open the initial position? Maybe you *add* it to the $2.5k divvie and buy another $5k's worth. Or maybe you go halvsies, and only re-buy $625 and pocket $625...
just thinking out loud, here...
-------------------- Nashoba Holba Chepulechi Adventures in microcapitalism...
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So if I would buy shares on say the 17th of March I would get the dividend? I want to make sure I get in on the dividend? I called etrade they said only people who own on the 7th will get the dividen?
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quote:Originally posted by joeyisthebest: So if I would buy shares on say the 17th of March I would get the dividend? I want to make sure I get in on the dividend? I called etrade they said only people who own on the 7th will get the dividen?
quote:Originally posted by joeyisthebest: So if I would buy shares on say the 17th of March I would get the dividend? I want to make sure I get in on the dividend? I called etrade they said only people who own on the 7th will get the dividen?
Just put this together--bud pointed out that the 21st is Good Friday and markets are closed. So last day to buy is Thursday the 20th.
Which kills my idea, btw...
Still might see a drop on record date, though...
-------------------- Nashoba Holba Chepulechi Adventures in microcapitalism...
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quote:I called etrade they said only people who own on the 7th will get the dividen?
Joey, send 'em the link to "NASD Notice to Members 00-54 August 2000 372" Here's crucial excerpts:
quote:For example, if the issuer of the security has announced a date falling on a Thursday as the record date of a distribution, the ex-date will be on Tuesday, two days earlier. The price of the stock is adjusted downward on the ex-date so that the amount of the distribution is reflected in the current stock price. Thus, in this example, Tuesday is the day on or after which a buyer would purchase the security without the dividend and the seller of the security would keep the dividend. If the sale occurred on Monday, a day earlier, the seller would not keep the dividend.
quote:if an issuer has announced August 10 as the record date and August 31 as the payable date, then the ex-date will be September 1, the first business day after the payable date. In this example, September 1 is the day on or after which a buyer would purchase the security without the dividend and, therefore, the day on which the price of the stock is adjusted downward. In this example, a seller of the security on August 15, even though the holder of record to receive the dividend, would have to relinquish the dividend to the buyer.
In other words, the critical date is the ex-date.
So, refer 'em to the notice and send 'em this link:
quote:Originally posted by joeyisthebest: So if I would buy shares on say the 17th of March I would get the dividend? I want to make sure I get in on the dividend? I called etrade they said only people who own on the 7th will get the dividen?
I would trust etrade! But thats me.
Oh, lawzy! Lol, Nile, we can't trust brokers to get this stuff straight--they scwoow it up, alla time...
-------------------- Nashoba Holba Chepulechi Adventures in microcapitalism...
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I am only going to put $100 in on the play anyway not want to risk too much in case I don't get the dividend I want to be able to sell for a decent price if there is a lot of trading activity on Thursday.
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posted
there is no trick to this play. this happens all the time with pennies. there is a special rule with divs of 25% or more of the stock price. there is an old thread about this, don't remember where. the whole idea behind it is margin calls. normally the pay date is after the ex dates. that means your stock price gets adjusted down for the div but you don't have the money for the div yet. with most divs it doesn't matter becuase the amount would be a small percentage. if you have a huge div though, with the normal ex and pay date, you would show a huge loss on your stock on the ex date with the adjustment for the div while you haven't received the cash yet which would trigger a margin call. so with the big divs, they change the dates and you get the cash the day before the ex date so you don't get a margin call triggered. there is an NASD notice somewhere on google.
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posted
What are your commissions? Is that even worth doing?
quote:Originally posted by joeyisthebest: I am only going to put $100 in on the play anyway not want to risk too much in case I don't get the dividend I want to be able to sell for a decent price if there is a lot of trading activity on Thursday.
posted
I pay $9.99 per trade figured I could get 530 shares if price was around $.17 then if I would get the dividend would get $53 and sell at $.17 hopefully before the price falls otherwise there was another stock I was looking at putting my money it its a more long term investment MSW and GRT both paying large cash dividends and poised for long term growth once people realize to stop chooseing a veriable fixed rate on there home morgage.
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quote:Originally posted by joeyisthebest: I pay $9.99 per trade figured I could get 530 shares if price was around $.17 then if I would get the dividend would get $53 and sell at $.17 hopefully before the price falls otherwise there was another stock I was looking at putting my money it its a more long term investment MSW and GRT both paying large cash dividends and poised for long term growth once people realize to stop chooseing a veriable fixed rate on there home morgage.
ok, maybe you're new to this but when the stock goes ex div, the stock prices gets adjusted the amount of the div. + or - any normal market activity. so if the stock is at .17 on the day before the ex-date, the stock will open around .07 the next day.
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posted
Well,I have 10,000 shares and I will hold until the adjusted price after distribution is back up to .10/s so if I sell at least I wont have a loss.If I hold and wait for the price to inch back up a few pennies I can have a profit.I hope.
posted
Bottomfeeder, imo, unless you got in today at .15, that's a good way to play it. Keep in mind what I said about tax implications though, because you'll owe taxes on the divs but probably won't be able to deduct the "loss" from the stock part of the play.
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posted
Nope,was yesterday at .19 but I have time to wait.Taxes will eat me up since I will probably be unemployed all year...Mom is now blind and health is fading..
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