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AmNet Mortgage, Inc (AMNT) Message Board

  • packeteerslikeus packeteerslikeus Oct 3, 2003 12:31 PM Flag

    Robert Rubin's Warning

    former Clinton Treasury Secretary said today the pressure from current Federal deficits could raise the 10-year to nearly 6.5% (sorry, can't find a link yet, heard it on Bloomburg)

    I'm sure his words have a LOT more to do with rates being up today, then irrelevant unemployment figures.

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    • invin - thanks - that's a good way at getting @ the answer - also - INV's fixed costs are not as great as conventional business - reasons are b/c all of INV's commissioned salesmen are on 100% commission with no salary; INV contracts out some of the application u/w; their AS400 is way underutilized; and their new office space is relatively small and leased - having said all this - based on your analysis - INV probably now needs to do about $500 mill/month to break even

    • If a refi wave like the first seven months of this year were to materialize now, INV's production would approximate $1.5B - $2B per month to start. Profits would be enormous.

      Clearly, this appears very unlikely until the interest rate cycle completes another whole turn -- up and then down again. Who knows how long this will take; maybe ~5 years?

      For me, this does not seem a bad holding period for this stock, assuming that INV demonstrates decent profits in normal, trending down mortgage years, as 2004 figures to be.

      We will have results in the coming two to three quarters. We'll get a very good idea in two or three weeks when they issue 2004 guidance.

      In the past, they've been very responsible in projecting earnings related to production in turn correlated to MBAA overall mortgage market estimates. Therefore, we'll get a glimpse of their confidence in managing revenue expansion and costs -- profit margin -- in a declining market.

      Also in the past, they've guided consevatively.

      I think that any guidance that starts with a $1 should be very well received, given the current tangible net worth. And any guidance that contains a $2 translates to a double in stock price anticipating or more likely upon execution.

      Of course, a 4% dividend announcement wouldn't hurt either.

    • When you find a single story that says whatever Rubin said (I thought he was still working on getting government favors for Enron) has anything to do with the bond movement today, please post it. If you'd like, I can post 100 articles that say the jobs data is the reason for the move. What a dope.

      D

    • If you really think that a big surprise in employment figures don't strongly influence yields on the treasury bonds during that day's trading, you are actually a bigger idiot than I thought...and that's pretty difficult.

      D

 
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