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Non-Tech : Auric Goldfinger's Short List -- Ignore unavailable to you. Want to Upgrade?

To: RockyBalboa who wrote (2694)	7/20/1999 8:14:00 PM
From: Sir Auric Goldfinger	Read Replies (2) \| Respond to of 19428

An old Fav, Metris (MTX) Get short!: First Union's Whitney on Metris Profit Report: Earnings Comment 7/20/99 13:8 First Union's Whitney on Metris Profit Report: Earnings Comment St. Louis Park, Minnesota, July 20 (Bloomberg) -- Meredith Whitney, an analyst at First Union Capital Markets, comments on Metris Cos.' second-quarter earnings, which rose 130 percent and beat analysts' expectations. Income from operations, before a charge of $152.4 million for the conversion of preferred stock by an investor, rose to $28.5 million, or 54 cents a share, from net income of $12.4 million, or 31 cents, in the year-ago period. Earnings beat the average analysts' forecast of 45 cents a share, according to First Call Corp. Whitney, who has a ''hold'' rating on the stock, said she was disappointed with several of the underlying numbers in the credit-card marketer's earnings report. ''Non-interest income, or income from fees, and the net interest margin fell on a sequential basis and that was disappointing,'' Whitney said. ''Also, the provision for losses came down and operating expenses were up.'' ''It was not a clean quarter so the general momentum in the stock is not what was expected,'' she said. ''Metris' exposure is 100 percent to sub-prime. They have the least amount of diversification, and they're in the riskiest business of any credit-card issuer. You have to have a very compelling reward ratio for taking on that risk'' as an investor, Whitney said. ''They also stated they probably will not make any more portfolio acquisitions this year. They've gotten a lot of kick this year out of acquisitions. Without acquisitions, it will be difficult to see huge upside in profitability,'' said Whitney. She said non-interest income fell from the last quarter because Metris didn't get as much business as expected from agreements to sell credit insurance, travel club memberships and other related products to cardholders at other big credit-card issuers, including Citigroup Inc., Household International Inc., and Bank One Corp. ''There should be a lot more upside than happened this quarter because they led people to believe these would be big money makers,'' Whitney said. --Adam Rombel in the New York newsroom (212) 893-3375"