Gleaming Into Fortress’ Earnings (FIG)

March 24, 2008 by Douglas A. McIntyre

Tuesday morning we’ll get to see earnings out of Fortress Investment Group LLC (NYSE: FIG). After close to a year of being public and as the public is scrutinizing anything not vanilla, this is an ever-important earnings report for it and for the sector.  The estimates for the public hedge fund and investment management firm from First Call are $0.18 EPS on $210.18 million in revenues. 

As it has a very limited time of being public, it is unknown if they will offer any guidance.  Next quarter estimates are $0.22 EPS on $261.18 million in revenues. Estimates for fiscal Dec-2008 are $1.17 EPS on $1.31 billion in revenues.

It appears as though options traders are braced for this stock “units) to move more than $1.00 in either direction, although we would caution that options are harder to use for price prediction as share prices become lower and lower.  There are very few contracts that have traded on this one, and options expiration date is now out until April 18.

On last look, its short interest was listed as being more than 9.6 million shares. With a high dividend of 8% and a massive short interest, this one could be a surprise winner if it doesn’t disappoint.  The company raised cash when it could in a strong market, but it has been a rough road since coming public in early 2007.  Analysts have an average price target north of $21.00, and its 52-week trading range is $9.50 to $34.03.

Jon C. Ogg
March 24, 2008