Player Avatar rochet5 (47.73) Submitted: 9/21/2007 10:42:35 AM : Underperform Start Price: $56.14 CS Score: +96.04

Worst in class. Crappy I-bank and need to cut a lot of fat out of their operations. Do not provide great service to their HF and institutional clients. Hung with a lot of CMBS and Leveraged Loans.

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Member Avatar jfeld22 (< 20) Submitted: 11/6/2007 5:45:53 AM
Recs: 1

Why do you feel this is the worst in class? In some ways they have to be seen as better with smaller amounts of subprime exposure than their competitors.

Member Avatar rochet5 (47.73) Submitted: 11/6/2007 10:15:09 AM
Recs: 1

Absolutely nothing to do with their exposure in sub prime assets. They are not a huge mortgage underwriter but they do have a large CMBS program that has generally included a ton of crappy assets with low debt service coverage and high LTV that has unattainable underwritten scenarios. I know they are hung with a lot of that and that could be the next write down. On top of that, their investment bank is worst in class in service. They sell assets that they refuse to give marks on, have a terrible lev loan desk, and are afraid to traffic in most debt trading.

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