Countrywide still in business
Countrywide (CFC) rose early Tuesday after the mortgage lender swung to a fourth-quarter loss. Countrywide lost $422 million, or 79 cents a share, for the quarter ended Dec. 31, reversing the year-ago profit of $622 million, or $1.01 a share. The company’s mortgage banking unit swung to a $623 million pretax loss, as loan funding dropped 48% from a year ago, and the banking operations posted a pretax loss of $279 million. “While considerably improved from the previous quarter,” CEO Angelo Mozilo said, “Countrywide’s results for the fourth quarter of 2007 were adversely impacted by further credit deterioration across the industry and continued illiquidity in the secondary mortgage markets.” The results made a mockery of Mozilo’s claim back in October, when he unveiled a $1.2 billion loss for the third quarter, that the company had “laid the foundation for a return to profitability in the fourth quarter.” No matter, though. Countrywide shares rallied as the report showed the company is still in business - which should be enough to keep suitor Bank of America (BAC) happy for now.
Hi….Colin…
Few lines…
1) BAC will not change the core of the deal with CFC, only it will retool very few issues.
2) Mr. Ken Lewis asked to Mr. Mozilo to show the worst scenario in sheet´s numbers of this quarter.
3) First quarter 2008 will show CFC in the range of $ (25.0 M) to + 70 M. Clearly improving while going into seconf half of 2008.
4) As I wrote in this site before…BAC will go all the way up to $48-$52 by second half of 2008.
5) Still is a very good shoot to sale puts BAC 45 January 2010.
Best regards friend.
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Hello Colin,
If Countrywide wants to fix their problems, they would look at helping their clients out of this mess. Focus on work-out strategies and also on educating them and getting their personal finances in order. They would make more money off of helping their clients to adjust their loans to fit their lifestyles.
Best of luck,
Michael J. Fitzgerald, CPA/PFS, CFP, MST
Registered Investment Advisor
http://www.fitzfp-llc.com