EIC: EAGLE POINT INCOME COMPANY Extension Buy Zone
Fundamentals:
Eagle Point Income Company (EIC) is not a super stock, but a solid monthly dividend payer. The dividend seems stable, and the outlook of the company is stable. Eagle Point Income is a closed-end investment company whose primary investment objective is to generate high current income, with a secondary objective to generate capital appreciation. Eagle Point Income invests primarily in junior debt tranches of CLOs in addition to investing up to 35% of their total assets (at the time of investment) in CLO equity securities and related securities and instruments.
CLO Junior Debt is an Attractive Asset Class because BB-rated CLO debt has had a relatively low historical default rate of 4 bps per annum. BB-rated CLO debt offers the potential for higher returns as compared to senior secured loans and high yield bonds. The Credit Suisse Leveraged Loan Index has generated positive returns in 29 of the past 32 full calendar years.
EIC currently is paying a 13% to 15% annual dividend yield with a monthly payout.
Technicals:
Weekly:
Weekly Triangle breakout on top of horizontal support test from Feb. 2023's high.
Weekly Crown pattern
Stage 3 ichimoku crown trend (strategy 3).
ADX trending
MACD and MACD Ichimoku up
1st pb of a new trend after a-b-c extension
Retracement to weekly 38%-50% area. It could turn into a kijun trend bounce. Could be the "X" point of a W-X-Y wave.
Weekly uHd developing inside 200 EMA wave
Plan:
I plan to reinvest the monthly dividend of this stock as long as I hold it. It is a place to park a little bit of unused capital for primarily dividend income and capital appreciation is seen as a bonus.
The target will be the October 2021 all-time-high (19.54ish). I believe the price will reach 17 to 20 by December 2024 or March 2025.
Eagle Point Income Company (EIC) is not a super stock, but a solid monthly dividend payer. The dividend seems stable, and the outlook of the company is stable. Eagle Point Income is a closed-end investment company whose primary investment objective is to generate high current income, with a secondary objective to generate capital appreciation. Eagle Point Income invests primarily in junior debt tranches of CLOs in addition to investing up to 35% of their total assets (at the time of investment) in CLO equity securities and related securities and instruments.
CLO Junior Debt is an Attractive Asset Class because BB-rated CLO debt has had a relatively low historical default rate of 4 bps per annum. BB-rated CLO debt offers the potential for higher returns as compared to senior secured loans and high yield bonds. The Credit Suisse Leveraged Loan Index has generated positive returns in 29 of the past 32 full calendar years.
EIC currently is paying a 13% to 15% annual dividend yield with a monthly payout.
Technicals:
Weekly:
Weekly Triangle breakout on top of horizontal support test from Feb. 2023's high.
Weekly Crown pattern
Stage 3 ichimoku crown trend (strategy 3).
ADX trending
MACD and MACD Ichimoku up
1st pb of a new trend after a-b-c extension
Retracement to weekly 38%-50% area. It could turn into a kijun trend bounce. Could be the "X" point of a W-X-Y wave.
Weekly uHd developing inside 200 EMA wave
Plan:
I plan to reinvest the monthly dividend of this stock as long as I hold it. It is a place to park a little bit of unused capital for primarily dividend income and capital appreciation is seen as a bonus.
The target will be the October 2021 all-time-high (19.54ish). I believe the price will reach 17 to 20 by December 2024 or March 2025.
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