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

To: Paul Senior who wrote (3684)	3/29/1998 11:14:00 AM
From: Wallace Rivers	Respond to of 78669

Paul, I don't claim to be the brightest guy in the world, nor do I do as much number crunching as you and others on this thread. I really respect the guy who follows this company for the firm I do business with. I'm sure he has the normal analyst pressures, but he has made some excellent calls...really plugging away with a Barnett Bank reco, as well as coming on EDS near the bottom, among others. He's good, although certainly not infallible. I really feel these guys are in the sweet spot as far as business is concerned...low interest rates, high new home sales. The risk, of course, is that said excellent interest rate environment will end abruptly. As to subprime, it is only a small percentage of their business. I am not crazy about the stigma it carries either, but I believe management is doing it as a means of diversifying their business portfolio. Most simply, I like this stock, as I may have stated before, because my source believes it can grow at a 30% clip over the next 3 years. It's multiple on current earnings is about 15X, on 2 buck estimates for next year less than 8. Compare that to Countrywide, a company in a similar business, projected by VL to grow at an 18% clip over about the same time period, trading at about 17X this year's earnings (1 Q to go), and 16X next year's. That is my most simplistic investment thesis for REMI.