Value Investing Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Value Investing

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: Marc Hyman who wrote (26359)	3/20/2007 1:36:28 PM
From: a128	Read Replies (2) of 78740

Well, on 1/25 the company provided guidance of $5.40-5.70 per share for 2007 and hinted that they expected to increase the dividend 6 cents each quarter...$1.12,1.18,1.24 &1.30 for total dividends of $4.84. Lets say their less than 2% subprime and other Alt-A loans cause them to miss guidance by 25% both on earnings and dividends. Thats still $4.05-4.275 per share in EPS and $3.63 in dividends. Lets further assume that they cant grow that in the future and just come in at that range for the next 10 years. Whats the stock worth ? A helluva lot more than $25 I would think. However, the lack of really heavy insider buying dampens my enthusiasm somewhat. I also dont know the extent of their exotic mortgages like interest only and teaser rates which are in effect negative amortization loans for a few years. Those could become problem loans in the future as even though the folks have good credit, they realize they cant make the note. Im afraid AHM as well as others felt like rising home values would protect them. Well, home values have decreased and interest rates have went up. Could be a double whammy. I dont know how much exposure AHM really has to loans they have sold.

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next