Will Annaly Capital Management’s Top Institutional Shareholders React to This DOWNGRADE?

In 2012, Annaly Capital Management, Inc.’s (NYSE:NLY) shares are up 5.58 percent. On Monday, FBR Capital Market cut its rating on the company to an “Underperform” rating from “Market Perform; it kept the $16 price target on the stock.

FBR noted that from Annaly’s portfolio size, it has a greater exposure to higher prepayments than its agency mortgage real-estate investment trust (mREIT) peers. A spike in prepayments was not forecasted but there is a belief for a steady 20 percent constant prepayment rate (CPR), resulting in continued-spread and book value erosion.

With the rating cuts, will Annaly Capital Management’s largest shareholders decrease their holdings? 247 institutional firms indicated owning shares of Annaly Capital Management, Inc. (NYSE:NLY) in Q2 2012. These firms reported owning a total of 88.032 million shares on 06/30/2012. The shares closed at $16.78 on 06/30/2012.

Here are the ten largest positions in Annaly Capital Management, Inc. at the end of June 30th, 2012.

Bank of New York Mellon Corp held 17,715,875 shares on 06/30/2012 worth $297,272,395. This brought the portfolio total to 0.12%.

UBS Global Asset Management Americas Inc held 14,500,000 shares on 06/30/2012 worth $17,799,000. This brought the portfolio total to 0.02%.

Zazove Associates LLC held 4,784,000 shares on 06/30/2012 worth $5,905,000. This brought the portfolio total to 0.15%.

UBS Global Asset Management Americas Inc held 4,084,083 shares on 06/30/2012 worth $68,530,916. This brought the portfolio total to 0.08%.

Mitsubishi UFJ Trust & Banking Corp held 3,774,186 shares on 06/30/2012 worth $63,330,844. This brought the portfolio total to 0.18%.

Cutler Capital Management LLC held 2,815,000 shares on 06/30/2012 worth $3,455,000. This brought the portfolio total to 1.97%.

Thompson Siegel & Walmsley LLC held 2,122,155 shares on 06/30/2012 worth $35,609,762. This brought the portfolio total to 0.75%.

SELZ Capital LLC held 2,000,000 shares on 06/30/2012 worth $2,455,000. This brought the portfolio total to 0.91%.

Sarasin & Partners LLP held 1,913,067 shares on 06/30/2012 worth $32,101,266. This brought the portfolio total to 0.61%.

Gateway Investment Advisers LLC held 1,815,622 shares on 06/30/2012 worth $30,466,138. This brought the portfolio total to 0.34%.

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