Posts filed under “Credit”

Five Days of Misery

Nice piece in Barron’s about the under-performance of the Financials this week:

"Big sell-offs often create bargains, but, as Barron’s has warned ("No Bargains in Brokers," Oct 29) investors should tread carefully. Financial companies typically have huge balance sheets and relatively modest capital bases, making them vulnerable to asset write-downs. Bottom fishers in financials already have been burned badly this year."

Earlier last month on CNBC, I noted that the Banks and Brokers were major "avoids, with at least another 20% downside — but I didn’t mean this week!

Here’s a table from the Barron’s piece:

Five Days of Misery

Investors’ confidence in financial companies was shaken last week. So were the share prices of some of the sector’s erstwhile stalwarts.

Stock Change 2007*
Company/Ticker Price Week YTD EPS P/E
Citigroup (C) $37.73 -11.5% -32.3% $3.74  10.1
American Intl
Group (AIG) 
59.12 -4.9 -17.5 6.74 8.8
Bear Stearns (BSC) 102.16 -12.1 -37.2 11.12 9.2
Merrill Lynch (MER) 57.28 -13.3 -38.5 2.87 20.0
Washington Mutual (WM) 23.81 -16.7 -47.7 2.37 10.0
AMBAC Financial (ABK) 23.51 -46.9 -73.6 7.84 3.0
MBIA (MBI) 35.51 -29.5 -51.4 6.32 5.6
MGIC (MTG)  18.00 -7.1 -71.2 -2.50 NM

NM = Not Meaningful.

Sources: Bloomberg; Thomson Financial

   

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Source:
The Week That Shook the Financial Sector
ANDREW BARY
Barron’s NOVEMBER 5, 2007   

http://online.barrons.com/article/SB119404861681681133.html

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