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Joe Eifrid

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  • 3 Wicked Reasons To Buy Mortgage REITs Today [View article]
    Have you guys looked at mREIT AMTG? New mREIT that IPO'd this summer. They should be announcing their first dividend soon and I think the stock could pop as it moves to the income producing screens. About 90% invested into agency MBS and 10% into non-agency. They doubled up their investments in October when PrimeX was showing weakness. Just about the same investment strategy and book value as MTGE. MTGE has already announced an 80 cents quarterly divy and selling for 18.52 ,whilst AMTG is dragging it's feet and has not at 15.82. Worth a look IMO.
    Dec 15 08:24 PM | 2 Likes Like |Link to Comment
  • A Buyback Won't Save Invesco [View article]
    HAVE YOU GUYS...sorry...have you guys looked at mREIT AMTG? New mREIT that IPO'd this summer. They should be announcing their first dividend soon and I think the stock could pop as it moves to the income producing screens. About 90% invested into agency MBS and 10% into non-agency. They doubled up their investments in October when PrimeX was showing weakness. Just about the same investment strategy and book value as MTGE. MTGE has already announced an 80 cents quarterly divy and selling for 18.52 ,whilst AMTG is dragging it's feet and has not at 15.82. Worth a look IMO.
    Dec 15 07:57 PM | 1 Like Like |Link to Comment
  • Profiting From The Survival Of Citigroup [View article]
    Some calculate return on funds at risk. That's how I look at it. $18.00 strike less the $2.78 credit is $15.22. Worst case if C goes belly up the most you lose is $15.22 and therefor how much you have at risk. If C closes above $18.00 on expiration you keep the $2.78 and that is 18.3 return on $15.22. Since you are selling a put and this is not a covered call there are no dividends.

    Look at this chart on C. Looks like C did a great job in raising their tangible common equity as compared to others.

    http://bit.ly/vhQEAV
    Dec 9 07:39 PM | Likes Like |Link to Comment
  • Shares of American Airlines (AMR) are halted (yet again) after tripping up a circuit breaker. It's been almost non-stop on-again, off-again trading in AMR ever since its bankruptcy filing because as a Russell 1000 stock it's governed by a trading rule that fires up a 5-minute pause anytime the transaction price moves 10% or more in the preceding 5 minutes. Pundits call the rule "absurd" as they beg the SEC to change the logic for low-priced stocks. For the record, AMR is up 61% on the day or about $0.41. [View news story]
    I am seeing Junior bonds selling in the 10 to 20 levels (10 to 20 cents on the dollar). That indicates more than anything that the AMR common shares will end up worthless. I think yesterday was a gift to get out of the common with at least something. I would sell and take the tax loss.
    Dec 8 03:46 PM | Likes Like |Link to Comment
  • Armour Residential REIT (ARR) announces an 8M share secondary offering, with an option to purchase up to 1.2M additional shares as warranted. Deutsche will act as the sole bookrunning manager of the offering. Shares -3.4% AH.  [View news story]
    Interesting that the mortgage REITs have been so beaten up but yet they still have no problems raising more capital to invest in mortgages. MTGE looks interesting. New mREIT selling for a 20%+ discount to book.
    Dec 7 07:41 PM | Likes Like |Link to Comment
  • Shares of American Airlines (AMR) are halted (yet again) after tripping up a circuit breaker. It's been almost non-stop on-again, off-again trading in AMR ever since its bankruptcy filing because as a Russell 1000 stock it's governed by a trading rule that fires up a 5-minute pause anytime the transaction price moves 10% or more in the preceding 5 minutes. Pundits call the rule "absurd" as they beg the SEC to change the logic for low-priced stocks. For the record, AMR is up 61% on the day or about $0.41. [View news story]
    The price action in AMR common is crazy. The common will end up worthless and the senior unsub exchange traded debt shares of AAR are selling for just 20 cents on the dollar. If the common had a chance of all getting any distribution the bonds would be trading nearer to full value. As I recall Delta actually rose to close to $4 per share in BK and still ended up worthless.

    Please Mr Market, go crazy with the MF bk shares I hold. lol!
    Dec 7 02:04 PM | Likes Like |Link to Comment
  • Shares of Assured Guaranty (AGO +4.4%) tack on another tidy gain, a day after gaining 8.7% on the strength of an analyst upgrade. Today's actions could be tied in part to a ratings boost from S&P on securities insured by the firm.  [View news story]
    May have more to do with Wilbur Ross Buying 2.464 million shares in an insider buy. Posted last night.
    Dec 6 12:38 PM | Likes Like |Link to Comment
  • Profiting From The Survival Of BAC [View article]
    I like the trade idea but in the same area I like C better.
    Current Market Price: $23.63
    Option: C Jan 2013 $20.00 Put (424 days to expiration)
    Current Premium (bid): $4.95
    Margin of Safety: 36.3%
    Total Return (if option expires worthless): 32.9%
    Look at BankRegData.com and compare C to BAC. C has much better numbers such as modified Texas ratio under 'asset quality'; BAC is 32.98, C is 20.04.(lower is better)
    http://bit.ly/vODS4w

    Don't get me wrong, I like BAC but think C is a bit better trade with less risk due to the better balance sheet and profitability. I also think C could profit internationally due to large depositors pulling out of large European banks and being attracted to a large international bank like C.

    Joe Eifrid
    Nov 27 05:41 PM | 3 Likes Like |Link to Comment
  • Operating under a memorandum of understanding since May 2009, BofA (BAC) is working to convince regulators it has taken adequate steps to strengthen the bank. Sources say regulators have started to warn of a public enforcement action unless BofA makes more progress on MOU compliance.  [View news story]
    "Sources say regulators have started to warn of a public enforcement action unless BofA makes more progress on MOU compliance."

    I think they just did.
    Nov 22 07:31 AM | Likes Like |Link to Comment
  • I'd be buying bank stocks "hand over fist," says banking analyst Dick Bove. "On a fundamental basis, it's almost impossible to believe that these stocks are not dramatically underpriced." As he sees it, investors should be taking advantage of the turmoil in Europe to buy, not sell every time the market "freaks out" over fears of the sovereign debt crisis spreading. His picks: Bank of America (BAC), Morgan Stanley (MS), State Street (STT) and US Bancorp (USB).  [View news story]
    Because of his job, Bove is restricted from buying BAC stock due to regulatory requirements. Easy for me to say but, I'd not be buying too if I was in his shoes.
    Nov 21 07:37 AM | Likes Like |Link to Comment
  • I'd be buying bank stocks "hand over fist," says banking analyst Dick Bove. "On a fundamental basis, it's almost impossible to believe that these stocks are not dramatically underpriced." As he sees it, investors should be taking advantage of the turmoil in Europe to buy, not sell every time the market "freaks out" over fears of the sovereign debt crisis spreading. His picks: Bank of America (BAC), Morgan Stanley (MS), State Street (STT) and US Bancorp (USB).  [View news story]
    ABCW? Modified Texas ratio of 163. It's peers average 34. (Lower numbers are better). 11.6% of it's assets are NON-performing! Negative shareholder equity.
    I think I will pass even at 22 cents....

    Second thought....delisted and going to the pinks? With the games and manipulation that can be played there maybe they do get a bounce before they go under.
    Nov 19 07:54 AM | Likes Like |Link to Comment
  • I'd be buying bank stocks "hand over fist," says banking analyst Dick Bove. "On a fundamental basis, it's almost impossible to believe that these stocks are not dramatically underpriced." As he sees it, investors should be taking advantage of the turmoil in Europe to buy, not sell every time the market "freaks out" over fears of the sovereign debt crisis spreading. His picks: Bank of America (BAC), Morgan Stanley (MS), State Street (STT) and US Bancorp (USB).  [View news story]
    I find BAC and C very cheap as well. I sold puts on them yesterday. From a contrarian point of view, and as evidenced by the comments here, it is hard to see how these two could be hated more. BAC, and I believe C too, are selling at less than half of TANGIBLE book.
    Nov 19 07:32 AM | 1 Like Like |Link to Comment
  • A new iSuppli teardown shows the cost to make the Kindle Fire (AMZN -0.8%) is $201.70, while the device sells for $199, reinforcing assumptions that Amazon sells the product at or near a loss. Among component suppliers, iSuppli says the biggest winner is Texas Instruments (TXN +0.2%), with total components accounting for ~13% of the device's total bill of materials.  [View news story]
    Yeah, but they can make it up in volume. AMZN is very good of making up excuses for not having earnings in volume.
    Nov 18 11:15 AM | Likes Like |Link to Comment
  • Trust Preferred Returns: Dodd-Frank Offers An Interesting Opportunity [View article]
    Did everyone see the news from BAC Thursday night? They commented in the 10Q that they are considering selling stock to buy back the trust preferreds. Page 10 of the latest 10Q;

    "During the third quarter, global economic uncertainty and volatility continued as described more fully in the Executive Summary – Third Quarter 2011 Economic and Business Environment discussion on page 7. Concerns over these and other issues contributed to a widening of credit spreads for many financial institutions, including the Corporation, resulting in lowering of market values of debt and preferred stock issued by financial institutions. The uncertainty in the market evidenced by, among other things, volatility in credit spread movements, makes it economically advantageous at this time to consider retirement of issued junior subordinated debt and preferred stock. As a result of these matters, we intend to explore the issuance of common stock and senior notes in exchange for shares of preferred stock and, subject to any required amendments to the applicable governing documents, certain trust preferred capital debt securities (Trust Securities) issued by unconsolidated trust companies, in privately negotiated transactions. If we pursue the exchange of Trust Securities, we would immediately use the purchased Trust Securities to retire a corresponding amount of our junior subordinated debt that we previously issued to the unconsolidated trust companies. These transactions would increase Tier 1 common capital and, on an after-tax basis, reduce the combined level of interest expense and dividends paid on the combined junior subordinated debt and preferred stock. The senior notes and common stock would be recorded at fair value at issuance, which is expected to be less than the par and carrying value of the preferred stock and/or junior subordinated debt, which would result in the exchanges being accretive to earnings per common share for the period in which completed. The ultimate impact on earnings per common share is not expected to be significant for periods subsequent to the exchange and will not be known until the level of earnings per common share for the period and the exact combination of exchanged preferred stock and Trust Securities are known. We will not issue more than 400 million shares of common stock or $3 billion in new senior notes in connection with these exchanges."

    IMO BAC would not be floating this trial balloon unless it was seriously considering selling stock. Surprised me we did not see more interest in the sub $25 BAC TruPs Friday. What was weird some very low non-cumulative traditional preferreds saw action (4 of them on the NYSE top 10 gainers list) on volume. I think this buyer is mis-informed. Right idea, but wrong issues.
    Nov 5 07:38 PM | Likes Like |Link to Comment
  • Phoenix: A Stock Set To Rise From The Ashes [View article]
    Hi sacca, I could see PNX back to $10 in a longer term time frame. I think much depends on interest rates and their ability to generate some investment income. Something that bothers me about a company like PNX in this low, low interest rate environment is the ability to payout on their annuity contracts. I would imagine their future capital generation needs were based on higher rates in the past. The Federal Reserves misdirected efforts to take interest rates down to boost the economy is backfiring on them IMO. I think PNX and their likes need to see higher interest rates before I think a company like PNX is totally out of the woods. That said, in more historical environment PNX should be again trading near book.

    For me, as my PNX position becomes a larger part of my portfolio, I will start taking some off the table if my position gets up over 4% of total for profit taking. For me the story has not changed so I am staying with it for now. I was encouraged by their last report.

    Another thiong that causes me to pause is that I think we have another financial crisis coming in the future. No matter how cheap PNX it will still be affected by the industry performance.

    Nov 5 07:30 PM | Likes Like |Link to Comment
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