Part 7/9:
- Business Health: Factors contribute to potential concern, leading to a 4 out of 5 in yield trap indicators.
2. Annaly Capital Management (NLY):
Yield: High, at 11.5%.
Debt: Debt-to-equity ratio close to 6, exposing the company to high risk.
Payout Ratio: Around 90% of funds from operations, concerning yet within typical REIT practices.
Cash Flow: Shows negative cash flows over recent quarters, marking significant risk.
Business Health: While there are no immediate issues, the sector faces potential risk from rising interest rates, contributing to concerns.
3. CBL & Associates Properties (CBL):
Yield: Alarmingly high, close to 20%.
Debt: Debt-to-equity ratio of 3.72, indicating excessive leverage.