tchannon

Corus Bankshares, Brush Engineered Materials: Two Winners Among Losers

Thanks again for your response. I feel that your comments address and rebalance the position, as you suggested. These forums are all about open discussion and expressing points of view. I am not interested in misleading retail investors, of course - and I never said "buy, buy, buy" and never said it is going to the moon. However, I do not believe that CORS is in the dire straits that you suggest, but anything is possible. However, it is a risk, as nothing in investing is guaranteed - anything can happen. Additionally, in my original article, I did express the risk involved and that going under can certainly happen. Let's see how the story unfolds. I have no pride when it comes to things like this - we are all here to make money, build wealth, and preserve capital. Those are my #1 goals - being 'right' is secondary to building wealth via investing in equities. It appears that CORS has been beaten down and that there is value in this company from the information readily available to the investment community. Investing in any company that has lost a great deal of market cap always comes with significant risk, but the rewards are potentially big as well. Best regards and I am enjoying the discussion.

Corus Bankshares, Brush Engineered Materials: Two Winners Among Losers

Thank you for the continue comments. Your points and concerns are certainly valid and I respect them. I do not see a scenario where a bank pretty much owned and operated by the same family that founded it 50 years ago would blatantly enrich themselves at the expense of stockholders and watch the stock price of the company plummet to zero. Obviously, we have differing opinions on the future of CORS, which any investment is not without risk, so it should be interesting to see how it pans out. For my sake, I do hope I am correct, but I have been wrong before - that is the nature of the market. Yes, there is high risk here - and certainly a chance of something worse coming out of the weeds, but I logically do not see it coming to that. The actions of CORS indicate otherwise.

Corus Bankshares, Brush Engineered Materials: Two Winners Among Losers

investorgold2002 - Thank you for your comments. Yes, I am aware of the risk that CORS faces in light of this very slow real estate market - and I am from South Florida, so I have seen it first hand. Yes, it is possible they will have to eat many loans and end up in a liquidity crisis - that is the risk and it very well could happen. I am betting that CORS, the Glickman's, and their very stringent loan committee that is intimately familiar with all of their loans, made above average decisions and will not be impacted as much as the market and the shorts are betting. Certainly, it could happen, but if it was really an imminent risk, the Glickman's and CORS would face major charges of enriching themselves via company cash when a collapse was imminent. Could they be doing that? Of course, it is possible, though unlikely. It may take some time, but I am willing to bet that CORS will not be impacted as much as the market is anticipating. I have spoken with the developers of many condominiums - and all have loans. Simply writing off the loan and abandoing the project is not realistically an option. The developers, in the first place, have to justify obtaining the financing, regardless of what source and regardless if it is secured or not. Banks simply do not just hand out dollars to these developers. Additionally, at some point, even if it is a few years, things will turn around and the projects will be complete and units will sell. The developer could bail out now, but why? To lose all that has been put into the deal - which is sizeable from a personal standpoint for these developers - is not going to happen. Things might be tight for them, but they will wait around if they need to before defaulting. Therefore, I would surmise that CORS will come out with some battle scars, but will not collapse, despite the negativity facing this sector. Yes, there is great risk, but that is why CORS is currently yielding about 6% (excluding the special one-time dividend). If eating loans to the point of going under was a real possibility, I doubt CORS would continue their dividend payments to shareholders. For them, making a bad decision knowing what will happen in the end if it is bad is an almost definitive path to having to forfeit their monies received from the strategy and watching their many-multi-million dollar stake deteriorate. Yes, stranger things have happened and there is risk involved with CORS way more so than say a Bank of America that is better diversified, but CORS is not going anywhere. Thank you for your insight - I welcome all points of view and discussion.