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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: a128 who wrote (26356)	3/19/2007 11:26:59 PM
From: Marc Hyman	Read Replies (1) \| Respond to of 78748

In the included article there's this: Ackor notes that subprime mortgages made up less than 2% of American Home's business last year. Fine and dandy. Now, pray tell, what part of their profits come from subprime mortgages? I'd guess more than 2%, but don't have a clue as to how much more. Any guesses? I almost bought at $21 (and wish I did), but am not sure about buying at $25. // marc

To: a128 who wrote (26356)	3/20/2007 1:36:13 PM
From: Madharry	Respond to of 78748

Ben Stein knows a little about a lot of things- a financial analyst he's not. As for AHM suggest you read this weeks Barrons carefully. AHM has a lot alt-a type loans and a lot of arms. their loan reserve is too small relative to the potential liability. If their is even 10% less demand for housing because of of more restrictive lending what will be the impact on pricing on starter homes and the next level up? what is the impact of investors who are stuck with unflippable condos? homebuilders trying to sell their now spec inventory? I just have too many questions here to have confidence that AHM will even be able to pay out a dividend over the next couple of years. If you have enough confidence maybe the preferred offers better value.