There was a perfect storm in late September to create a shorting opportunity in this stock (I did not short). Taper talk, poor reported earnings, and ownership restrictions of Sec. 382 pushed the price down.
Additionally, it appears management was in a quiet period related to this Amerihome sale. So, nobody was supporting the price.
Now, the good news is going to start pouring in. (might be FY14)
Those MSRs that management is set on acquiring add intangible value each Quarter. This is intangible value is based on three things 1. 10% plus discounted cash flows. 2. Unlocking the value of the Deferred Tax Asset (perhaps as much as 70 cents incrementally on each $1 MSR) 3. Natural hedge on rising interest rates (10% plus fair value sensitivity on 100 BP swing from 2nd Q to 3rd Q.)
The MSR was $27 million at end of the 3rd Q and is increasing about $5 million each Q. The sale of Amerihome provides them more room to acquire MSRs and build up that intangible.
i am a simple man, to me the writeoffs will diminish because of housing recovery plus the increase in mortgages will generate earnings,,,,,,,,,who cares about the perfect storm analysis, speak english please.