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The Company through its wholly owned subsidiary Mortgage Guaranty Insurance Corporation provides private mortgage insurance in the United States to the home mortgage lending industry.
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jwfoster (99.23) Submitted: 4/11/07 11:54 PM : Start Price: $57.34 MTG Score: 55.35
They released their Q1 earnings at 10:30 PM. They missed by 60 cents.They saw a 70% increase in insurance losses when housing didn't begin to tank until late in the Q.They have yet to write down or address their C-Bass venture in any meaningful way.Why would a shareholder want to own stock in a company that releases earnings when shareholders aren't paying attention, has mounting losses, and has subprime exposure they won't address or quantify?This thing should get a 50% or more haircut over the next year.
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Nittany95 (91.20) Submitted: 4/19/07 6:25 PM
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I own it as of 1.5 months ago and will tell you why: 1) Most negatives priced in, 2)Will benefit from the subprime meltdown more than they will be hurt by it through C-Bass. The major issue with the subprime mtg industry is the 100% financing without insurance through using 1st and 2nd mortgages/trusts. Over the past several years, people went that route to avoid paying mtg insurance. It is also why FHA loan usage tanked. Now, customers that want a 95% loan will need to buy mtg insurance and with the merger there are now fewer places to get it. Thus, even if housing sales do not stop declining, demand for this companies primary products will increase. Housing would have to have an all out crash for it not to. In addition, eventually housing activity will increase and the subprime 100% financing will not be making a comeback. Thus, long term looks great. Short term will also be great as the housing "crisis" is a bit overblown in the media. Even if I am wrong on that, you can't argue the long term fundamentals.
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