Monday, September 8, 2014

if the warrants can't be exercised what would today's closing price have been????

anthonychristiano606  20 minutes ago Flag

if the warrants can't be exercised what would today's closing price have been????

Anthony says – Sometimes it helps to monitor the current price of a stock relative to the market in general. As of 9/5/14 the PE ratio of the S+P 500 was 19. The current price of FNMA can be compared to the market making some basic assumptions. The most recent quarter can be useful since it represents a “normalized quarter”. There are several things that can dramatically affect earnings, but, in order for common shareholders to be successful it is critical to end the sweep amendment and come out of conservatorship. The net earnings computed are the earnings after payment of preferred stock dividends. The following is the annualized earnings based on normalizing the 6/30/14 quarter:

1) Net earnings ($3.66 B x 4 quarters) ……. $14.6 B
2) Less Senior Preferred Stock dividend … …11.7 B
3) Less Junior Preferred Stock dividend … … .1.3 B

4) Equals common retained earnings ……….$1.6 B
5) Common retained earnings per share ($1.6 / 5.7 b shares) …... 28¢ per share

Anthony says – Dividing todays’ closing stock price of $3.62 by the earnings per share of $0.28 = a PE of 13. As of 9/5/14 the PE the S+P 500 was 19. At $3.92 the stock appears undervalued when compared to the S+P 500. The comparison can be made at any price level on the stock. For instance $4.50 on the stock would be a PE of 16 ($4.50/.28). The retained earnings per share can also be altered by other events such as the non-exercise of warrants or the elimination or reduction in the Senior Preferred stock dividend. If the warrants are not to be exercised the earnings per share go from 28¢ to $1.40 per share. The relative PE at a stock price of $3.62 would be a PE of 3. Incredibly undervalued when compared to the S+P 500. To value the stock price at a comparable market PE just multiply the earnings of $1.40 x a PE of 19 to get a comparable price of $26.60 per share. That’s where the stock would trade today without the prospect of a warrant exercise


Ill do the exercise too :

senior Preferred have been paid back, as it was a loan, I say this is the ruling the court will give.
the warrants are only collateral on that loan, so are also washed out when paid back is seen by courts.

so same numbers 3.66 x 4 = 14.6 B
less senior = 0
less junior preferred = 1.3 B
commons earnings = 13.3 B

common retained earnings per share 13.3/ 1.2 = $11.08 a share

at a pe of 15, much lower than the s&p the value, and you have $166 a share.

Ill say it again, $166 a share. what kinda highway robbery is going on by our US TREASURY on us shareholders?

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