NEW ex-dividend on 12/27 (5%)
High-profile mortgage company New Century Financial will pay a regular quarterly dividend of $1.90 on January 31 to holders as of Wednesday, December 27. That’s 5.3% of the share price of $35.710, or a 21% annual yield. NEW has been steadily increasing its quarterly dividend till January 2005, but keep an eye on the rise in mortgage delinquencies, as painfully illustrated by the woes of H
December 9th, 2006 at 9:41 am
Mortgage delinquencies are not the problem for Mortgage lenders, they sell their portfolios to Wallstreet mortgage securities buyers and generate new income with mortgage brokers and retail. Its like a credit card they pay it off every 15 to 30 days and rarely keep a balance.
What hurts them is the decline in mortgage originations and revenues that are down 50% and hence EPS for mortgage lenders are down consistently. NEW has lower EPS than last year and stock price reflects this change. NEW is in a protected downtrend and if you buy this stock you will lose money while you get the divident.
This play is NOT without significant risk. Just look at the chart in Sept and see what happened there.
December 12th, 2006 at 10:26 pm
NEW, like NFI, OSTK and other stocks, are plagued by the illegal manipulations of a few hedge funds, aided by dishonest market makers, that sell “naked” shares, and never deliver the stock, creating the Fail To Delivery, which constitute the “stockgate” or the financial scandal of the century.
The extention of this phenomena plaging the american financial stock exchanges, is threatening the whole financial system; luckily in the last year or so, more and more legal state institutions and the american Congress as well are taking an interest into this criminal financial activities of a number of (well known) hedge funds.