Tuesday, July 29, 2008

I have found a spectacular short.

It's a bank, with

* attempts to dilute NPA% with growing asset TREMENDOUSLY in 2007 -2008
* dividend is 400% of earnings.
* operating in CA, FL, NV, AZ AND MI, yes the holy grail of blight Michigan!!!!.
* analyst can NOT provide positive commentary at best
* is rallying hard but nobody is watching.
* NPA is climbing rapidly in $ basis and adjusting for the less season (age) this is significantly worse than comparable books.

The stock is still rallying hard and I will post what I have as soon as stabilization hits. Maybe tomorrow after some #s from ADP, they usually like to taser the short, even more so than USA who actually loves the short.

23 comments:

Anonymous said...

FITB :)

ARAK said...

FITB operates in CA, AZ and NV? Aren't they a mid western bank?

ARAK said...

with some FL exposure as well

MTGSPY said...

not FITB. I am staying quiet until the job report, maybe getting in at even better price.

ARAK said...

you think job report won't suck as much as expected?

Anonymous said...

comerica doesn't have branches in las vegas...

.haha just kidding, they do....

vin said...

mtg, I'm watching it, now. :D Thanks for some pointers.

ARAK said...

Comerica's dividend 400% of earnings? 0.66 / 0.37 = approx 2. Did you subtract the one time charge of 21c to arrive at 0.66 /(0.37-0.21) = approx 4?

Where do you expect this sucker to land up price wise in Jan 09?

MTGSPY said...

I was NOT thinking of CMA. CMA seems to be a bit too diversified for a reliable short. For something at that price or book level I love ZION.

Please focus your efforts in single family lending, and accept commercial lending only if CA/FL/NV element is present. Think something that has fallen 60% and currently experiencing crazy bear market rally. And be patient till the bulls run out of ammo, for all we know both ADP and payroll will be explosive. Not to mention the GDP report.

Greenie said...

What do you think of USB, Mr. Spy?

MTGSPY said...

it's a WFC-type.

Penn said...

are you referring to M&I bank, seems to meet all the criterion

MTGSPY said...

I meant as hard as a short play as WFC. Better find easier target.

I have to admit that the guys in the room shorting WFC are among the most crack of the troops. They seem to know shomething and don't mind waiting.

ARAK said...

Mtgspy,

I give up. Waving the white flag here. Will wait for your post exposing this mystery bank.

PCap said...

ADP + 9,000

Time to Rally Like a Bull in a China Shop

MTGSPY said...

excellent. As expected ADP come in hot and this should be able to pump things pretty good today. Tomorrow's payroll is more of a function of the weekly claims, which are increasing. You will hope today sufficient # of people are forecasting +ve number tomorrow if you are planning to take a position (with a stop, in case), like me. heheheh.

Penn said...

When are you planning on revealing the mystery bank in the post?

MTGSPY said...

depends on how fast they pump :D

No worry it's still rallying.

vin said...

mtg, just to check. it's not rallying nearly as much as yesterday, huh? barely moving for the past 15 minutes in fact... of course, if we've found different targets with similar characteristics, all the better. :)

MTGSPY said...

The key here is commercial real estate. They have not been rallying. Once they do and stop, I feel justified that the bulk of it is done and what's left is just the usual low volume pump/bear flags.

vin said...

mtg, CRE. we've got the same thing in mind, then. shucks, would have been nice to have 2 shorts. :P

D said...

If you want to know what the future of CRE looks like checkout a one-year chart of JLL.

:)

On a side-note, their HR department knows how to hire "talent"!!! Had drinks a couple weeks ago with a 23 y/o doing tenant-rep leasing there.

WOW! I will send some pics MTG if I get some!

Anonymous said...

so what is it, please?