Another stock, Indymac Bancorp (IMB), has substantial upside, once the short covering steamroller gathers speed. With a lower opening likely today, you could get it a buck or so cheaper than yesterday's close. One dividend cut is priced in, and even if they lost money in Q4 and cut the whole dividend, the stock will be much higher in 2008, perhaps even by late November or early December.
The rolling capitulation sector wide among financials is probably 80% done, and perhaps even more so among the mid and small caps. The near term upside is awesome, as seen in the bond insurers since the lows Monday. SEC filings for Q3 are due next week, but barring a nuclear bombshell in the form of bankruptcy for some big name, most of the bad news (even perhaps more) is priced in. The next big move is up (through Q4 earnings). IMB will survive in a diminshed capacity, as will Monday's favorite short squeeze favorites (ABK) and (MBI), ratings downgrades (or capital additions) and all. Stay tune for best ideas.