What long-term strategies suit MITT's volatile EPS history?

AG Mortgage Investment Trust, Inc. (NYSE: MITT) has a history of volatile EPS, which is a key metric indicating the company's profitability. Given this volatility, MITT's long-term strategies should focus on mitigating the impact of these fluctuations and ensuring the company's financial stability and growth. Here are some strategies that could suit MITT's volatile EPS history:

1. Diversification: MITT should continue to diversify its investment portfolio to spread risk across different asset classes and sectors. This can help stabilize EPS by reducing the impact of any single investment's performance.
2. Conservative Leverage: The company should maintain a conservative leverage ratio to manage risk effectively. While leverage can enhance returns, it also amplifies losses, making volatility more pronounced. MITT should aim for a balance that optimizes returns without excessive risk.
3. Strengthening Dividend Policy: MITT's recent dividend increase to $0.20 per share is a positive sign. Consistent dividend payments can help stabilize EPS by providing a predictable income stream. The company should consider maintaining or increasing dividends gradually to reinforce investor confidence and offset potential EPS volatility.
4. Capital Allocation Optimization: MITT should optimize its capital allocation by focusing on high-return opportunities while managing liquidity effectively. This includes timing investments strategically to capitalize on market conditions and minimize losses during downturns.
5. Risk Management: Implementing robust risk management practices is crucial. This includes regular stress testing, scenario planning, and maintaining a strong liquidity position to navigate periods of high volatility.
6. Strategic Partnerships and Alliances: MITT could explore strategic partnerships or alliances to share risks and leverage synergies. These collaborations can provide additional stability and growth opportunities during volatile periods.
7. Investment in Technology and Innovation: Investing in technology and innovation can help MITT improve operational efficiency, reduce costs, and enhance risk management capabilities. This can contribute to more stable EPS over the long term.
8. Enhancing Governance and Executive Compensation: Strong corporate governance and executive compensation structures that align with long-term performance can encourage management to focus on sustainable growth and risk management, rather than short-term gains.

By implementing these strategies, MITT can better navigate its volatile EPS history, enhance long-term financial stability, and create value for its shareholders.