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Finance
Today it was announced that TIAA was buying Everbank (EVER) for $19.50 per share.  Everbank is a very average bank with lower returns on equity than the big banks.  As of the 2nd quarter 2016, Everbank’s tangible book value per share was $13.24 meaning that TIAA is paying right around 1.5 times tangible book.  Because...
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I’ve been writing extensively about the incredible undervaluation of the big banks relative to intrinsic value. Financials in general are by far and away the cheapest and most attractive area of the stock market.  Remember banks have been around for many centuries, and the reason for that is it’s a pretty good business to be...
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While banks have been our worst performers year-to-date, it is not because they aren’t performing well from a fundamental basis or improving their financial strength materially. In a stock market that is very expensive and where market participants are taking incredible risks through paying 35-40% higher than historical averages for certain sectors and companies, financials...
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  I’ve written and talked a lot about the overall stock market being slightly overvalued and bonds being in a massive bubble. With that said, many stocks and industries have sold off dramatically over the last year and a half and are in their own bear markets. It is somewhat surprising that the index itself...
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    “Many that are fallen shall be redeemed, and many shall fall that are now in honor.” Horace 20 B.C. During the late 1990’s, tech stocks reached valuations that nobody could explain. While most people saw the dynamically changing marketplace and felt the extraordinary impact of the internet, traditional valuation metrics such as P/E...
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July 29th, the Federal Reserve announced the results of the CCAR process including the requested capital return actions for the big banks. Unsurprisingly to those that have been reading this newsletter, the results were very good and we have seen an influx of dramatic dividend increases and stock buybacks. Below I’ll outline a few of...
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It looks as though the PROMESA legislation is going to be approved by the Senate and signed by the President in the very near future. While far from perfect, this legislation is also far from being a worst case scenario for both creditors and bond insurance companies. It is hard to overstate just how attractive...
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I’ve received many questions on really what the Brexit means. It is a rather confusing subject in many ways so I found a very good article that does a better job explaining it than I could personally. I wouldn’t pay too much consideration into the last few days trading since the results of the election...
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Last Thursday’s Brexit vote led to a historically nightmarish day in the financial markets: Indexes across the globe were down between 3-10%. The British pound dropped from a high of $1.50 to $1.32, before finally recovering to $1.37, down an enormous 9% for the currency. European banks stocks were down between 15 and 20%. S....
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Last night’s vote for Great Britain to exit the EU was a massive shot to the bow of the European establishment. While polls had been even, the betting odds were basically 8-1 that the country would stay in the EU, so markets are quite shocked at the result. In overnight trading, just about every asset...
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