Forbes Article re: Mortgage Lenders & Short Opps:
The New Issue of Forbes - has an interesting article on Mortgage Co's from Sam Lieber of the Alpine US Real Estate Equity Fund... a top performer.
- it's a good read.
Buys:
LEND (disagree - more later)
CFC
IMH (bottom fishing, after acctg blow up ?)
SFI
MHL
Sells:
NLY
ANH
CT
NCT
NFI (Deathwatch)
RAS
...those on the REIT business model must come back to the Capital Markets and in this environment with FNM Derivates/Credit/Accounting Issue's & the volatility in the Bond Market, Global Currency Rebalancing, roaring US Deficits, US Dollar structural weakness - that adds an element of high risk and uncertainty.
- markets never like "uncertainty."
I listened to LEND's most recent Conference Call and while LEND has always been one of the "cleaner" SubPrimes... I could NOT ignore the subtle underlying tone of "schmoozy-used car salesmanship" that infests the Sector in general...and a bit of rationalization concerning adopting new, aggressive loan programs (with no track record of performance)and the very clear message of the brutal level of competition on the street simultaneous to compressed margins.
LEND, like virtually everyone in the subprime sector, is suffering from margin compression and there seems to be the near Universal Problem that exists sectorwide as well - the over-focus on production growth and driving the shareprice at virtually any cost...ie: conceeding to market pressures on credit quality and aggressive loan programs etc. And very importantly, they do not pay a dividend...
$33.60 is support....I'm holding it short, as long as it stays within it's downward trading channel..it's basing a bit here & hovering around it's 200 dma...I'm just setting "stops" at the upper red band of it's present trading channel.
stockcharts.com[d,a]daclynay[d20040901,20050823][pb50!b200!d20,2!f][iut!ub14!uc20!lp14,3,3!lf!lg][J57483197,Y]&listNum=2
- no surprises in the Goldstocks - the usual suspects were bears at the bottom and couldn't be found and are now Cheerleading-Chest Thumping Mega-Bulls at an interim Top that's produced a whopping 2 HUI points since the interim high from the original breakout rally - 9+ weeks ago.
+40 points in 20 trading days versus + 2 points in 9 weeks.
- whodathunkit ?
Energy stocks remains weak into record high prices for the underlying Commodities - THAT IS DIFFERENT & SIGNIFICANT - again; a KEY CONCEPT here for Oilpatch Traders is that the Matt Simmons Peak Oil Thesis has painted itself into a Q-4 Supply-Demand Shock corner .... and Energy is OVER-OWNED and there is one helluva lot of money sitting in Oilpatch Stocks...with one helluva lot of unprotected profits hanging out there in the Simmons-Kool Aid wind...and the Year End Statements for Fund Managers will look much nicer if they lock in profits here and NOW...versus letting it all ride on the Simmons-Q4 Supply-Demand Shock Thesis.
Tic' Toc` for the Q4 Simmons Supply-Shock Thesis...
Only 5 weeks to Q4....Inventory numbers tomorrow.
Technically, sooner, or later - the former longterm resistance level for the OSX at 150 - will need to be retested as new support.... hopefully it will be "sooner" (vbg)~
CASH is NEVER-TRASH...still sitting in 50%+ and awaiting those discrepancies between price and risk.
...patience.
Slider |
