The Big Picture » our ratings remain L.” While many Street analysts seem http://www.ritholtz.com/blog Macro Perspective on the Capital Markets, Economy, Geopolitics, Technology, and Digital Media Tue, 14 Feb 2012 21:30:51 +0000 en hourly 1 http://wordpress.org/?v=3.0.5 Sell Rating on Brokers http://www.ritholtz.com/blog/2008/06/sell-rating-on-brokers/ http://www.ritholtz.com/blog/2008/06/sell-rating-on-brokers/#comments Mon, 09 Jun 2008 13:15:00 +0000 Barry Ritholtz http://thebigpicture.dev.wilder.ca/blog/2008/06/sell-rating-on-brokers/ Note: This was written Sunday, and scheduled to post later this week — but given the Lehman news, its more timely this AM:

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We have been discussing some of the issues surrounding the brokers. We have had an "AVOID" on the sector for the past 2 years (due to balance sheet concerns), and we reiterated a sell on Lehman Brothers (LEH) last week for due to Technical factors. (My pal Charlie Gasparino disagrees with me on this).

Research from Portales reveals the some of the details regarding exposure to further write-downs.

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click for larger table

Brokers_major_asset_class_writedown

Source: Portales

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I do not have high expectations for sector earnings in Q2’08, with more write-downs of RMBS, weak underwriting activity, and questionable trading returns.

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Previously:
Dirty Tricks at Lehman? (June 2008) 
http://bigpicture.typepad.com/comments/2008/06/dirty-tricks-at.html

Related:
Lehman Set To Raise $5 Billion Amid Losses (WSJ)
http://online.wsj.com/article/SB121296377617855623.html

Lehman Sheds at Least $120 Billion of Assets to End Bear Stigma (Bloomberg)   http://www.bloomberg.com/apps/news?pid=20601087&sid=aUaJYcbwzbjI& 

Where Will U.S. Banks Beg Next? (WSJ)
http://online.wsj.com/article/SB121296970442155821.html

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