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Assured Guaranty Ltd. Message Board

  • redwinedrops redwinedrops Nov 16, 2009 6:22 PM Flag

    This say it all...

    Just in from Ruters.....

    Says plan may be expensive, dilutive to shareholders

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    • They have the ability to raise capital *today*. And what happens if we have a big leg down in the market and several important banks or corporations collapse? Will they have the ability to raise capital then?

      I would like to see them take the pain *once*, and raise so much money in the process that all of these rating agencies and whiners who want to nit pick every possible loss they might have someday would just be forced to permanently shut up. :)

      Starting from that floor we could get substantial re-ratings and multiple expansion, and upgrades from analysts and ratings agencies. It's the difference between trading at a forward P/E of 8 and and 20. The gain from expansion of their multiple would more than offset the one-time 25% dilution of the stock price.

    • No, it doesn't say it all. This is excellent news under the current circumstances. By year end, Fitch and Moodys will give AAA ratings due to the increase in capital. AGO trades off of three factors. It's non-GAAP operating income, it's tangible book value, and the ratings provided by Fitch and Moodys. All three of which look to be falling together to be a fifty dollar stock in no time. But don't take my word for it, ask Wilbur Ross. He'll no doubt be fronting most of that three hundred mil.

    • That must be why it is tanking AH. *sarcasm*

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