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TD AMERITRADE Holding Corporation (NASDAQ: AMTD) has just filed an automatic shelf registration statement with the SEC today, which many rumor mongers may jump on and point to the notion that this lends more credibility to some buyout rumors from yesterday that it may want to acquire E*TRADE Financial Corporation (NASDAQ: ETFC). AMERITRADE did not offer any terms nor any size or timing, but the offering is solely for senior debt securities and for subsidiary guarantees. As with most automatic shelf registrations, no underwriters were mentioned by name.
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Posts related to ‘Financial Stocks’
AMERITRADE Shelf Registration Spurs E*TRADE Speculation Further (AMTD, ETFC, SCHW)
Risks in Geithner’s Call For More Lending
U.S. Treasury Secretary Timothy Geithner spoke this morning and has effectively called for banks which have received government bail-out funds to boost their lending activities. Geithner noted that a lack of lending and strict limits to credit might act as a buffer against a continued recovery.
The Obama administration is trying to come up with new ways to turn the credit back on for small businesses. It is no wonder that Goldman Sachs Group (NYSE: GS) launched its initiative this morning. The firm’s public relations and financial relations campaign is a $500 million 10,000 Small Businesses initiative aimed at fostering small business growth and job-creation for up to 10,000 small businesses. The company plans to offer business education, mentorships, business networks, and capital.
Geithner noted that banks need “to be working with us, not against recovery.” He also noted that it was taxpayers saving the banks rather than their great intelligence and efforts that has led to the return of bank earnings, and he said banks have some responsibility and are obliged to assist in the recovery of communities. But, Geithner also defended banking sector earnings. It has been noted how lending standards have tightened month after month. Where this gets interesting though is in evaluating credit risks and interpolating that data for risks ahead.
American Express & Revolution… The Reach Down (AXP)
American Express Company (NYSE: AXP) is about to get larger in the credit arena, and in a new path than its traditional high-end clients. The company announced that it has agreed to acquire Revolution Money, which was launched by AOL Co-founder Steve Case in 2007. The purchase price is expected to be approximately $300 million. This may just be the first of several reach-down initiatives from AmEx.
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52-Week High Club (AGO, SMTL, SINA, TWB)
Assured Guaranty Ltd. (NYSE: AGO) over 32% to a yearly high of $28.14 after the company posted earnings of $0.44 per share, beating analysts estimates.
Semitool Inc (NASDAQ: SMTL) rose over 30% to a yearly high of $11.00 after Applied Materials Inc (NASDAQ: AMAT) agreed to buy the company for $11.00 per share, or $364 million.
Sina Corp (NASDAQ: SINA) rose over 10% today to a yearly high of $47.95 after the Chinese internet portal beat earnings and projected margin improvements.
Tween Brands Inc (NYSE: TWB) rose over 11% today to a yearly high o $10.16 after the company posted a profite of $0.58 per share, beating analyst estimates.
Garrett W. McIntyre
Verisk Analysts, Lackluster Initiations (VRSK)
Verisk Analytics, Inc. (NASDAQ: VRSK) is seeing some very cautious or at least unexciting analyst initiations now that its quiet period has ended. This post-IPO has at least held its value, which is more than many other post-IPOs can claim. The risk management suite of actuarial data came public in early-October in a $1.9 billion IPO after it sold 85.25 million shares at $22.00 per share.
It turns out that many felt it was a fully priced deal. Yet the stock popped above the pricing and has never gone back close to it. Since the deal opened, it has traded in a trading range of $26.10 to $30.00. The problem is that today’s slate of analyst initiations has failed to give investors any solid endorsement nor any solid hope of a real growth of shares.
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Paulson Takes Huge Stake In Citigoup, Dumps Goldman
John Paulson is rather notorious, and wealthy, for how much he picked up by shorting financial stocks on the way down. But the financial world found out in August that Paulson & Co. had bought up many key financial and banking stocks. Paulson & Co. Inc. is out with a 13-F filing after the close showing he is still in many key financial stocks.
The famed hedge fund manager took a massive stake in Citigroup and sold his entire interest in Goldman Sachs
- Bank of America (NYSE: BAC) was listed as 159,794,229 shares, down from 167,990,464 shares.
- Capital One Financial Corp. (NYSE: COF) was static as a stake of 17,000,000 shares of common stock.
- Citigroup Inc. (NYSE: C) is listed as 300,000,000 (three-hundred million) of common stock.
- Fifth Third Bancorp (NASDAQ: FITB) was static as a 5,000,000 share stake.
- First Horizon National Corp. (NYSE: FHN) was 7.11 million, up from a stake of 3,000,000 shares in August.
- JPMorgan Chase & Co. (NYSE: JPM) was down to 2,000,000 shares, down from an August stake of 7,000,000 shares of common stock.
- Marshall & Ilsley Corp. (NYSE: MI) was static at 12,000,000 shares of common stock.
- People’s United Financial Inc. (NASDAQ: PBCT) was static at 2,750,000 shares of common stock.
- Regions Financial Corp. (NYSE: RF) was static at 35,000,000 shares of common stock.
- SunTrust Bank Inc. (NYSE: STI) was static at 1,500,000 shares of common stock.
We had also noted back in October how Conseco, Inc. (NYSE: CNO) had scored a Paulson investment.
Goldman Sachs Group Inc. (NYSE: GS) was NOT in the new filing compared to the August filing where he listed 2,000,000 shares of common stock in the August filing. State Street Corp. (NYSE: STT) was NOT in the filing versus a stake of 700,000 shares of common stock in August.
JON C. OGG
Corzine as Bank of America CEO? (GS, BAC)
Jon Corzine recently lost the gubernatorial race in New Jersey. He is also a very wealthy Wall Streeter that is a former disciple of Goldman Sachs Group Inc. (NYSE: GS). He is also a democrat that is very friendly with the Obama administration. And now the strange rumor mill is getting stranger….
Charlie Gasparino on CNBC just threw out the idea that Corzine could potentially be in the running for the CEO role at Bank of America Corp. (NYSE: BAC) as the replacement for Ken Lewis….. after he touted his book again. Gasparino noted that he asked Bank of America about this and the ‘rumor’ was not denied but was given a ‘no comment’ answer which Gasparino expanded upon.
In this new world under the ‘new normal’ it seems that anything is possible.
JON C. OGG
When The News Is Not The News: The AIG CEO Story
Robert Benmosche, the CEO of AIG (NYSE:AIG) is known for being hot-headed, mercurial, self-centered, brilliant, ill-tempered, and gifted. He is just the sort of executive who threatens to quit his job several times a year. He probably likes to hear his board and colleagues say how much they need him.
The Wall Street Journal reported that Benmosche told his board that he was ready to quit because pay czar Kenneth Feinberg would not go along with requests from AIG to allow key employees to have base salaries above those Feinberg was prepared to approve. AIG claimed that it could not retain its best talent with the prospect of only modest compensation. There is nothing unusual about that. The chairman of GM made a similar statement about the difficulty of hiring and retaining talent at the car company when the federal government is unbending in its plan to keep pay scales low at firms with TARP investments. Read More
How Much is Benmosche Really Worth to AIG? (AIG, MET)
American International Group, Inc. (NYSE: AIG) is under pressure today after its new CEO Robert Benmosche, who has not even had a full three months yet on the job, has effectively threatened to walk out as CEO of AIG. The reasoning is over the intense restrictions of being under the government, particularly as it pertains to compensation limits. What is interesting is that this may be a strong CEO throwing the gauntlet at the government. But we also want to explore what Benmosche is actually worth in real dollar terms to AIG today. Chances are it is far more than just this 4% we have seen the stock drop today.
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9 Of 10 Bank Holding Companies Make The Cut
Yesterday, the Federal Reserve reported that 9 out of 10 bank holding companies that were required to raise additional capital to bolster their balance sheets have successfully done so. The Supervisory Capital Assessment Program (SCAP) had determined in May that these needed to raise $74.6 billion by November 9th. This was achieved through new issuance of equity in the amount of $39 billion, conversion of existing preferred equity to common equity amounting to $23 billion, and the sale businesses and assets amounting to 9$ billion. The ten bank holding companies that were required to raise additional capital were: Banks of America (NYSE: BAC), Citigroup (NYSE: C), Fifth Third Bancorp (NASDAQ: FITB), GMAC LLC, KeyCorp (NYSE: KEY), Morgan Stanley (NYSE: MS), PNC Financial Services (NYSE: PNC), Regions Financial (NYSE: RF), SunTrust (NYSE: STI), and Wells Fargo (NYSE: WFC).
Of the ten the one laggard was GMAC, which failed to raise the necessary funds. The May SCAP report indicated that GMAC needed to buffer its balance sheet with an additional $11.5 billion in Tier 1 capital. The Federal Reserve expects the troubled mortgage and auto loan originator to fill in its funding gap by accessing the TARP Automotive Industry Financing Program.
Garrett W. McIntyre
Moody’s to AIG Rescue? (AIG)
American International Group, Inc. (NYSE: AIG) is running this morning. The stock is trading higher this morning on a debt rating comment from last night. It turns out that Moody’s might have some relevance after all with the gains we are seeing. Moody’s issued a report last night noting that AIG will be able to repay its Federal Reserve credit line, and that it will be able to repay much or all of the investment from the US Treasury Department’s if financial markets stabilize. That is still an “IF” and not a definite event.
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Is Citi’s Primerica IPO For You (C, MS)
It has been some time in the making and won’t be the last IPO or divestiture out of Citigroup Inc. (NYSE: C). The company is proceeding to divest its Primerica Inc. via an initial public offering.
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GE No Rescue for Financial Junk Stocks (GE, FNM, FRE, AIG)
General Electric Co. (NYSE: GE) may be the one single bright spot taking the market higher this Friday when you consider the 10.2% unemployment rate and when you look over the latest round of earnings. Both Oppenheimer and Bernstein raised their official GE ratings to “Outperform” in research calls this morning. It depends upon which way the wind blows, but there are many times that GE trades more like some of the troubled financial stocks rather than as the top industrial stock in America.
American International Group, Inc. (NYSE: AIG), Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE) are all headed in opposite direction of GE. We noted that Fannie had broken the buck in pre-market trading and is back above the $1.00 level now. It is also dragging down Freddie Mac. AIG is adding to larger losses seen at the open.
GE shares are trading up 5.4% at $15.21 and we have already seen over 30 million shares trade hands in the first 20 minutes and pre-market period.
JON C. OGG
CIT Highlights Risks in Junkier Financial Stocks (CIT, FNM, FRE, ABK, C, ETFC, AIG, PMI)
It is of little surprise that CIT Group, Inc. (NYSE: CIT) is seeing clobbered today. The company has finally filed its pre-packaged Chapter 11 bankruptcy package and that has CIT shares down a sharp 63% at $0.26 on triple its average volume. By now, the game is probably known by everyone that bankruptcy usually leaves shareholders of common stock out in the cold. Should it be of any surprise that the “other troubled financial stocks” are seeing their shares head south?
It was just a week ago that I discussed the Fannie-Freddie equity conundrum. Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE) are down further. After all, these two are in government conservatorship. It is even easy to argue that these are just being kept alive so that Uncle Sam doesn’t have to include the obligations on the Fed’s balance sheet. And how many investors in these companies really believe that they are holding anything more than a long-term warrant or LEAP option that is way out of the money? Fannie Mae is down 7.4% at $1.00 and Freddie Mac is down almost 9% at $1.12, and neither are on active volume today.
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CIT (CIT) Prepares Chapter 11
According to The Wall Street Journal, CIT (NYSE:CIT) will file for Chapter 11 today. Bondholders will probably provide $4.5 billion in financing for a prepackaged bankruptcy. Senior creditors will likely get $.70 on $1. Carl Icahn, who offered that company $1 billion in financing, may be left out in the cold because CIT may not need the capital he has offered.
Taxpayers are likely to see their $2.3 billion investment in the firm go to zero.
The group that will lose the most money that fastest are the investors who have bought CIT shares over the last several weeks, betting the company would not have to go to court. Shares traded at $2.20 on September 29. On October 19, CIT traded at $1.21. Investing in CIT was a long shot and investors who put their capital into the stock are likely to watch the shares fall to a few pennies tomorrow morning.
Douglas A. McIntyre
The Unusual Suspects (BEAT, CIT, CIT-PZ, GNW, GFIG, HGSI, GSK, MCO, BRK-A, RVSN, CSCO)
Earnings season is seeming to wind down here, but that won’t stop the unusual suspects of key equity events and issues to watch this coming week. We are looking into key issues for the coming week in the stocks of CardioNet, Inc. (NASDAQ:BEAT), CIT Group, Inc. (NYSE: CIT), Genworth Financial Inc. (NYSE: class=GNW), GFI Group Inc. (NASDAQ: GFIG), Human Genome Sciences Inc. (NASDAQ: HGSI), GlaxoSmithKline Plc (NYSE: GSK), Moody’s Corp. (NYSE: MCO), Berkshire Hathaway Inc. (NYSE: BRK-A), RADVISION Ltd. (NASDAQ: RVSN) and Cisco Systems Inc. (NASDAQ: CSCO).
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CIT (CIT) Gets $1 Billion From Icahn
CIT Group (NYSE: CIT) it has entered into an agreement with Carl Icahn to support its restructuring plan and secured an incremental $1 billion committed line of credit from Icahn Capital LP to provide supplemental liquidity for CIT as it pursues that plan. Read More
Visa Solid, But Not Immune (V, MA)
Visa Inc. (NYSE: V) is reporting some stellar earnings considering the environment and this appears to be the 6th or 7th beat against estimates. The credit card processing giant posted $0.74 non-GAAP EPS vs. $0.72 EPS estimates from Thomson Reuters. The company also initiated a share buyback of up to $1 billion. As far as 2010, the company sees 11% to 15% revenue growth and is comfortable with 20% earnings growth. There are some metrics still showing growth, but it is obvious that not even the great big Visa is immune to a global recession with a world full of price-sensitive shoppers. The report is also rubbing off a bit on MasterCard Incorporated (NYSE: MA).
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The Fannie-Freddie Equity Conundrum (FNM, FRE)
It is no secret that things could be much better at Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE). But the last week or so has re-highlighted just how dire the situation is for these government sponsored entities and perhaps more importantly for the common shareholders. Both Freddie Mac and Fannie Mae were forced into federal conservatorship last year by Uncle Sam.
We have taken an in-depth look here at the situation and the past to get a feel for the future of these companies (GSE’s). If you parse through the data and watch what has been happening in Washington D.C. of late, there is the clear reminder that these emperors have no clothes on. In the world of Star Trek, these companies stockholders may be facing a Kobayashi Maru scenario.
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Icahn Claims Close to Par Value in CIT Bonds (CIT, GS)
CIT Group, Inc. (NYSE: CIT) has had a lot of news this week. A lot this year for that matter. Last night there was word that it had reached a loan agreement with Goldman Sachs Group (NYSE: GS). And even earlier this week came challenges from Carl Icahn over the removal of management and a commitment for a $6 billion loan. And then today, Icahn is stepping his efforts with an open letter to CIT bondholders. If you are a shareholder of common stock in CIT, what is in the best interests of bondholders and creditors is not necessarily the same as being in the best interest of the common shareholders.
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