Hey banjo...that's cool. That must have been almost 10 years ago. I actually started my "act" on the Prodigy boards prior to that. I still have members in my Yahoo group now from those days. What a wild time is right. Nice to hear from you!
I just want to say for the record that I apologized to mr. market for my remarks last month and that im glad he's back....I was starting to run out of material!!! seriously though, Welcome back ....and i have a challenge for you .......Give me a play, long or short, for the next 2 days...or at least a time frame . If im wrong i'll admit it and i will be your biggest backer since Alice graced us with her presence
May was a cool month weather wise but it was red hot for $$$MR. MARKET$$$. When interest rates are near zero, what's a good way to make money? Give up? Why don't you lend money, because for every dollar you lend and collect interest, you're almost certain to make more money. Today I bought NFI at $51.45. I will sell it in 4 to 6 weeks at $59.40. Here's why I like NFI: NovaStar Financial Inc. invests in mortgage assets, with a focus on non-conforming mortgage loans. The Company also originates single- family non-conforming loans and manages retail brokers operating. Loan servicing is also a critical part of its business operation. By servicing loans, the Company strives to identify problems with borrowers early and take quick action to address problems. As of December 31, 2002, NovaStar had 216 active branches in 35 states. Nonconforming loans - those designed for borrowers with blemished credit histories or limited documentation - create even more work because you have to hunt down lenders and products to meet specific needs. NovaStar's Internet underwriting system, called NovaStarIU, lets brokers lock in prices and loans for customers online. That eases a lot of the paperwork and loan hunting. The slow economy helps, because it creates even more demand for loans to borrows with checkered credit histories. Interest rates got pretty low for conforming mortgages, but there's still a big segment of the population that couldn't qualify for a standard form of credit. Moreover, nonconforming loans are less sensitive to a rise in interest rates because they're typically used to consolidate debt or credit cards. Novastar averages around 8.5% to 9.0% for all of the loans it offers, but the rate it pays for the funds is a lot lower. Each quarter, nonconforming loans are pooled and sold off as bonds with guaranteed payments. NovaStar insures the loans to lower the risk to investors. As the Fed Funds rate drops, the spread tends to widen. Many customers who get home equity lines of credit don't subsequently refinance once they pay off their credit cards. NFI continues to enjoy this coupon of income. Sharp interest rate moves post a risk. NovaStar is an active hedger, which means it tries to lock in favorable rates over long periods. NFI's stock is up 180% in the last 12 months. All this with a P/E of only 8.56. I tell you these mortgage companies get no respect on the street. This stock has mo babyâ¦it's r^2 correlation coefficient is 0.85 over the last 6 months. Yup..a straight stairway to heaven. If you look at NFI's earnings profile, it made $2.07 last quarter. Since we don't see the economy heating up until at least the 4th quarter, interest rates should stay very low. This will enable NFI to make a ton of money this year. $$$MR. MARKET$$$ projects earnings of $9.76/share. This means NFI, with its modest P/E of 8.56, will still get to a share price of $83.55 by the end of the year, well past my sell target of $59.40. Not that I ever care about what the experts think, but: PortfolioGrader.com, published by Louis Navellier, who also publishes MPT Review and Blue Chip Growth Letter. Navellier currently gives NFI a grade of "A" on an A-to-F scale, up from "B" in early February. Dow Theory Forecasts, edited by Richard Moroney (no relation to Bart Moroney who eats for the cycle), also has increased its rated of NFI. This newsletter's "Quadrix" stock rating system currently gives the stock an overall score of 99 on a 0-to-100 scale, which is higher than the score given currently to any other stock. Revenues for NFI have grown 250% over the last 2 years. Their brokers are sa â mokin babeeeeeeeeee! Wait..I didn't even get to the good news yet. NFI paid a dividend last year of $6.08/share. That's right..6 bucks. That's a 12% yield⦠woo hoooooâ¦more money! They paid $2.25 last quarter for crying out loud. This company is swimming in cash. With the new tax laws, this is even better for NFI investors! NFI return on equity is 27%. If all of this is too good to be true, it probably is. NFI's shell game can't go on forever. Competitors are going to want to get in on this. As their loan portfolio gets bigger and bigger, their outstanding receivables are going to get bigger and bigger, thus their default risk will weigh heavier on their balance sheet. The good news is that the market probably recognizes this risk and that's why Wall Street only rewards NFI with a P/E of 8.56. I'm only taking this for a short ride, and I don't see anything fundamentally different in the economy over the next couple of months. For now, NFI is an incredible money machine. OK..let's hear what the boss says: "Our performance is on track with the goals we outlined for 2003--expanding our portfolio of mortgage-backed securities with attractive, risk-mitigated returns by funding a growing number of the nation's home mortgage loans," said Scott Hartman, Chief Executive Officer. NovaStar expects earnings for the full year to total between $7.50 and $8.00 per share (SANDBAGGERS!) , as compared to previous full-year guidance of between $7.00 and $8.00 per share. "First-quarter production was in line with our previously stated goal to originate between $4 billion and $6 billion of non-conforming loans in 2003," Chief Operating Officer Lance Anderson said. "Our goal is for NovaStar's growth in nonconforming loans to outpace the growth of the nonprime market." Mr. Anderson added: "We opened 30 affiliated branches, reaching a total of 246 branches nationwide. And it's very important to note that 22% of the non-conforming loans originated in our wholesale business were taken from our branches, compared to 17% in the fourth quarter. Fifty-six percent of our conforming loans were originated in our branch offices. Our goal is to increase market share for all of our operations in 2003, and we're off to a great start." I think $$$MR. MARKET$$$ is off to a great start as well. I am HUGE!! Bring me your finest meats and cheeses! $$$MR. MARKET$$$ http://groups.yahoo.com/group/mrmarketishuge/
The mrmarket yahoo site brags, "I have 17 consecutive profitable trades of 15% or higher since January 2002. " I don't understand... are we supposed to lower our returns to compete?
WOW!!!..Taht's a pretty aggressive return and I give you credit for going for such a big return...i thought for sure you would pick a 3.00 stock to be up " 15% in three weeks"...But ok, Im on it and will give it a try...maybe 50 shares just to test it out.