My guess is any sale of Aussy full or partial will coincide with getting USMI divides which should come in 1h 2017. Still can't believe no call questions per comments that were exploring financing options which is something new. I could see a scenario where a Paulsen type invests in Gnw to reduce /refine debt in return for some equity. Paulsen if you recall was a big Gnw shareholder who wanted them to split off or sell ltc a couple years ago he sold out when was clear it was not going to happen but now it might
I'm starting to think Aussy odds of Aussy being sold are increasing especially if can get one more big special divvy or if no more special divides planned Could have scenario where Gnw announces the sale but gets another special divvy before the sale is finalized say Bo 2017. Total proceeds could be about 750m which would cover 2018 debt with 150 m left. With Aussy real estate market bubbly and defaults rising it very well could be time to get out from down under...
Yup, I noticed that right away...obviously good as original rasm guide was not that good IMO Margin still the same
Of course as you said if Aussy pps hits say 3.50 and than sells off with market etc back under 3.00 than yes they likely should have sold at 3.50 which would generate enough cash to pay off 2018 debt with some to spare. Would lose annual divies but save 42 m in annual interest expense
Aussy was around 4$ share this time last year when CEO talked about selling it so I doubt will sell at current price unless they really feel will benefit company which IMO it will not unless no more special divies coming. Canada is near 52 week highs which is very good , Gnw would be near 52w high of 5.50 IMO if 2h outlook was better . Interest rates too low and reserve and margin testing coming and lower 2h LTC /LI earnings ...bad combination , need some good asset sales news to counter shaky 2h outlook or a strong analyst upgrade. Strong Analyst upgrade unlikely as seems less analyst covering Gnw and the ones that are are maintaining current views
10 yr tbill high in 1q was 2% yield vs end of 2q low of 1.46% and 52 w high of 2. 35% and boy 2.25%. Get a clue and stop wasting my time ....boy I miss the Ignore feature
Big drop in rates in 2q clearly having a negative impact on Gnw and CEO/cfo's big concern going into 2h...PPS would be over 4$ otherwise. Yesterday's strong jobs report caused only a small bump up in rates, will need September fed hike and that may not help as rates have dropped big since 12-2015 hike. Rates need at minimum to be little higher in 3q than end of 2q for Gnw to report decent 3/4q
Sorry but that is not the reason I stated the clear reason which is potential issues in 2H...will need a new catalyst to get to 4$ such as Aussy sale or other strategic actions that reduce debt/increase liquidity. 2q report was very good but not 2H outlook
Sold off yesterday because once investors like myself closely read ccall transcript it was clear low rates a big drag going into 2h and of course Moody's downgrade threat. If not for these issues pps would be over 4$ like after 1q report. Has absolutely nothing to do with trading technicals other than yes if market up/down than the odds of any stock tracking the market obviously increases
Obviously due to strong jobs report which is good for interest rates. Nothing to do with technical bs
Possible but as you said higher rate would likely not be good for shareholders. Sure would have been useful if analysts had questioned CEO/Cfo on this matter but that would be expecting way too much of them, asking useful questions
Ironic that rates are at historic lows yet Gnw cannot refinance their debt period let alone at lower rates. Aussy pps up over 3$ On 2q report so that's still an option but the way they have been kicking off big divies I would not sell unless smaller divies expected. Debt for equity swap also an option if debt holders feel Gnw equity has significant upside...any dilution ok IMO as long as not excessive as it will take debt issue off table and would likely lead to credit upgrades.
Interesting that both the CEO and CFO mentioned refining the debt as an option, this is something new as before they said they could not refinance at least at reasonable rates. Of course analysts should have questioned them as to what has now changed that refinancing may be an option
So Moody's and a m best downgraded Gnw when they announced in February that they were going to destack and now Moody's may downgrade because the de stacking will not happen fast enough...isn't that special. Same idiots that downgraded US debt and facilitated the debt crisis of 2008
I almost bought Jan 3$ calls but decided not to since have a lot of shares. Report very good only negative is they said LTC earnings will be significantly less in 2h vs 1h.