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$10.80 1.10 (11.34%)
7/23/2008 4:02 PM

Freddie Mac (FRE)

CAPS Rating:
*

A stockholder-owned corporation chartered by Congress to create a flow of funds to mortgage lenders. Purchases certain residential mortgages that it finances by issuing mortgage pass through securities and debt instruments in the capital markets.

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Avatar EviLucius (79.40) Submitted: 3/26/08 12:10 AM : Underperform Start Price: $32.85 FRE Score: 25.81

Investors in FRE are in for a long and painful ride. There is still more bumps in the road. With three and a half billion in losses last year and nowhere to sell their mortgage backed securities, their stocks will continue a downward slump for at least one to two years to come. No banks or institutions are willing to invest in such high risk mortgage back securities, which leaves investors in FRE holding the bag. Expect continuing losses in earnings as more homeowners go into default in the next year or two when their interest rates reset. Betcha can't take your eyes away from this train wreck.

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