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View Full Version : FMD - First Marblehead Corp.- NYSE- Credit Services


BadThad
12-06-2007, 08:18 AM
FMD lost over 20% of it's value yesterday, some think it was an overreaction. I might try this play today because the company is solid, just that earnings will be off a little and there's some analyst downgrades.

FMD on Google Finance (http://finance.google.com/finance?q=NYSE:FMD&source=finance)

Chart (http://stockcharts.com/h-sc/ui?s=FMD&p=DAILY&b=5&g=0&id=p45233594847)

Yesterday's Close Price: $19.93
High: $57.56 08JAN2007

AS OF TODAY:

TheStreet.com: BUY
Ford: BUY
Jaywalk: BUY

BadThad
12-06-2007, 08:25 AM
Here's a nice summary of the years events for FMD:

http://stocks.us.reuters.com/stocks/keyDevelopments.asp?rpc=66&symbol=FMD&timestamp=20070912131400

BadThad
12-06-2007, 09:35 AM
I'm in....taking a chance on this bottom...sometimes you just gotta! My buy price: $20.78

BadThad
12-06-2007, 09:37 AM
Interesting:

The First Marblehead Corporation (NYSE: FMD) enjoyed record volumes in its fiscal first quarter, which led to a strong report on Oct 25. The student lender announced earnings per share of $1.80, compared to $1.49 a year earlier, and total revenue of $380 million, versus $303 million. EPS beat the consensus by almost 2.3% while revenue growth amounted to 25%. This Zacks #1 Rank watched earnings estimates for the year ending June 2008 rise by 4.5% over the past month. First Marblehead appears to be an attractively-priced stock with room to grow, as evidenced by its PEG Ratio of 0.15 - well within this screen's parameter of less than or equal to 0.55.

BadThad
12-06-2007, 10:50 AM
Crap....bottom not here yet! Had to bail for a small loss, not worth the risk to hold. Sure hope I can make it up soon! :-||

Buku
12-06-2007, 11:06 AM
Looks like it might have hit and be on the way back up a little?

BadThad
12-06-2007, 11:28 AM
Looks like it might have hit and be on the way back up a little?

Looking like it just might be at bottom. I'm going to reenter soon, I only lost $200 bucks and I plan on making that up and then some. LOL

Buku
12-06-2007, 11:47 AM
I am watching it. I am thinking of entering also.

Buku
12-06-2007, 12:20 PM
Geez, glad I didnt get in yet!!

[ ?

BadThad
12-06-2007, 01:04 PM
LOL...that's the market...I reeentered at $17.25. Gotta get back on the train at some point. This is a great company, I still think the market is WAY over-reacting. Found this interesting:

Second Curve Capital LLC, the investment firm run by Thomas Brown presented First Marblehead (NYSE: FMD) at the Value Investing Congress last week as one of his best ideas for 08. First Marblehead is one of Thomas Brown's Second Curve largest holdings.

Brown was the last speaker at the Value Investing Congress and gave a 30 minute presentation as to why he likes FMD. First Marblehead securitizes student loans for banks including JPMorgan Chase & Co and Bank of America. Brown said there is a significant margin of safety with FMD. He also said First Marblehead is a 20% grower, has a PE of 6, P/E/G of 0.2 and should be a three bagger in two years.

Since the Value Investing Congress, First Marblehead has fallen over 25%.

Second Curve Capital has lost 50% of its value this year. Brown expects a rebound in financial stocks next year.

Brown's other top pick is CompuCredit (Nasdaq: CCRT), which provides credit and other related financial services.

Buku
12-06-2007, 02:22 PM
In at 17.25

BadThad
12-06-2007, 02:52 PM
In at 17.25

How cool is that....we're in at the same price. :) Now, let's keep our fingers crossed that the selling is finally over.

Buku
12-06-2007, 02:55 PM
Yeah, I hear that. Looks good though. I am thinking if it can just hold this today we will be sitting pretty good.

BadThad
12-06-2007, 03:08 PM
YES! We're in the green brother! I could sell now and make a little money...but I'm holding this puppy. What broker are you using?

Buku
12-06-2007, 03:09 PM
I use Banc of America Investments

BadThad
12-06-2007, 03:39 PM
WOOOHOOO....I think we're in the clear, we may have just nailed that bottom. Man, I love bottomfeeding! :lol: Printing $17.90 now.

Buku
12-06-2007, 03:40 PM
I was just watching that. Feels good. Looking better by the minute. '-)

Buku
12-06-2007, 03:41 PM
$18.20 on the move!

Buku
12-06-2007, 03:45 PM
I think they heard me....spoke too soon

BadThad
12-06-2007, 04:12 PM
I think they heard me....spoke too soon

Ahhhh...we're cool, I've seen these too many times. It closed at $17.96. As long as there's no bear market or panic attack by investors tomorrow, this stock is going higher. If it follows the normal trend, next week we just might see a swarm of buying as word gets out about the "fire sale" on FMD. Normally, that's when I bail. LOL Let them run the price up, I sell, the PPS drops again and they're left HOB. hehehehehe :D

BadThad
12-07-2007, 09:12 AM
If we hold another 10 days we get a divy! :)

The First Marblehead Corporation (NYSE: FMD) announced today that its Board of Directors has declared a quarterly cash dividend of $0.12 per share on the Company's Common Stock, which is the amount paid in the comparable quarter last year. The company paid a cash dividend of $0.275 per share last quarter. The dividend is payable on December 21, 2007 to stockholders of record at the close of business on December 17, 2007.

The company also announced today that it has elected not to execute a securitization transaction this fiscal quarter.

"Due to uneconomic terms in the current capital markets, we have elected not to securitize private student loans this quarter. We are exploring non-securitization and securitization alternatives for future quarters to enhance our business model and provide long-term capacity to the private student loan market in a manner that benefits our shareholders. Our business volumes remain strong and we see many opportunities to facilitate and process private student loans," said Jack Kopnisky, Chief Executive Officer and President of The First Marblehead Corporation. "Our Board of Directors determined it was prudent to continue to return capital to our shareholders this quarter even during these challenging times."

"With regard to the current credit environment, First Marblehead continues to monitor closely the performance of the portfolio," added Kopnisky. "The credit quality of the overall portfolio remains strong with average FICO scores in excess of 700. Steps have been taken to tighten underwriting criteria related to lower credit tiers. The collection and recovery processes are being modified, including reaching out earlier to borrowers, and to co-borrowers who frequently have higher credit scores than borrowers. These new processes are being implemented and the results are not yet reflected in the performance of the portfolio. We remain focused on providing long term value to our shareholders, our clients, and students."

BadThad
12-07-2007, 10:25 AM
Dangit....taking a hit this morning, looks like it's going to be longer hold. :-||

ktavera
12-07-2007, 12:40 PM
It looks like it has hit bottom. I'm in at 16.50. Think we will se gains later in the day.

Buku
12-07-2007, 12:56 PM
Yeah, I was kinda surprised it was taking this big of a hit today. No biggie, will just hold longer.

Buku
12-07-2007, 03:15 PM
Wow, look at this. Back to $17.60 :lol:

ktavera
12-07-2007, 03:33 PM
I'm up 7%. This should be exciting next week.

Buku
12-07-2007, 03:36 PM
I'm up 7%. This should be exciting next week.

You did a GREAT job in getting in at the price you got in at. Kudos to you!!

BadThad
12-07-2007, 03:58 PM
Wish I could have got in at 15.69 today.....what a bargin that was....it was also very scary for us holders. LOL

Buku
12-07-2007, 04:02 PM
Wish I could have got in at 15.69 today.....what a bargin that was....it was also very scary for us holders. LOL

I hear that... I was pleased with the close.

BadThad
12-07-2007, 04:06 PM
I hear that... I was pleased with the close.

Indeed, I was quite worried this morning. I shouldn't worry so much. LOL This is one helluv a company, they are very, very solid, our money is safe. However, my goal was to flip this thing and get out with a quick profit. So far, I'm down about $125 with my last fake "bottom" buy and sell. Maybe I'll hang out for the divy, if I do, I'm probably in for the long haul because most stocks dip after the divy and take a week or longer to recover.

BadThad
12-10-2007, 09:55 AM
WOOOHOOOO....just printed $18.25! :D

Buku
12-10-2007, 10:22 AM
I have an order in to sell at $18.25. So we will see. It hasnt filled yet.

BadThad
12-10-2007, 11:05 AM
I have an order in to sell at $18.25. So we will see. It hasnt filled yet.

NoooooOOOOooo....LOL. Why you doing that man? It's gonna run today, I can just feel it.

BadThad
12-10-2007, 11:07 AM
I need $19 PPS to make a 10% profit, that's my goal.

Buku
12-10-2007, 11:27 AM
LOL, well, as it started running, I cancelled my order. Luckily it cancelled before it filled

Buku
12-10-2007, 11:32 AM
I sure am glad I cancelled. I would have been ticked. $18.50 :o

BadThad
12-10-2007, 11:38 AM
I sure am glad I cancelled. I would have been ticked. $18.50 :o

WHEW! Hang with it, with the FED annoucement coming today, we should see $19+ IMO. Plus, the divy EX date is coming close.....I might just hold for the divy, but that 10% profit always tempts me....and is probably the wise thing to do.

Buku
12-10-2007, 11:49 AM
I see why you like the bigger stocks. I am enjoying this. Pennies can make you some pretty good money quick. But way too much stress. I am going to have to start trading a few big ones with the penny stocks. This one is looking pretty good today.

BadThad
12-10-2007, 12:57 PM
I see why you like the bigger stocks. I am enjoying this. Pennies can make you some pretty good money quick. But way too much stress. I am going to have to start trading a few big ones with the penny stocks. This one is looking pretty good today.

LMAO! Dood....those penny stocks can crush you. I'm so tired to losing money with them. With these big board stocks, your money is safe. You get caught occasionally with a bear market and they may drop...but you just hold and stock recovers eventually. With the pinks, the stock drops and you're screwed 99% of the time. LOL

BadThad
12-10-2007, 03:55 PM
DAMNIT....no $19 today like I figured. :-||

fortuna1
12-10-2007, 04:09 PM
I agree, the only other penny I play is tdcp and that seems to be holding on by a thread. LOL
If it goes up I'll pull some money and start investing more in the big boys.
AAPL sure hasn't disappointed me!

ktavera
12-10-2007, 04:12 PM
im kind of suprised at the lack in movement later in the day today... maybe we will see something more significant tomorrow. I was tempted to take my profits when it hit 18 today but I have confidence that it will pass 19 before the end of the week.

BadThad
12-10-2007, 04:22 PM
im kind of suprised at the lack in movement later in the day today... maybe we will see something more significant tomorrow. I was tempted to take my profits when it hit 18 today but I have confidence that it will pass 19 before the end of the week.

I like how you think! '-)

BadThad
12-10-2007, 04:24 PM
I agree, the only other penny I play is tdcp and that seems to be holding on by a thread. LOL
If it goes up I'll pull some money and start investing more in the big boys.
AAPL sure hasn't disappointed me!

Big board isn't quite as exciting as the pinks, slow and steady gains are the picture here. However, chances are slim you'll lose you whole investment like pinks can do. LOL

BadThad
12-11-2007, 09:57 AM
Will we see $19 today? :)

Buku
12-11-2007, 09:59 AM
Lookin pretty good so far. $18.16

ktavera
12-11-2007, 10:50 AM
Will we see $19 today? :)

I'm sure we will by the end of the day. What exit price is everyone looking to get out at?

BadThad
12-11-2007, 11:28 AM
I'm sure we will by the end of the day. What exit price is everyone looking to get out at?

I need $19 to hit my 10% goal.....please get there today! LOL

BadThad
12-11-2007, 02:34 PM
Man, afternoon crush.....looks like the hold will continue...bring on my divy! LOL

Buku
12-11-2007, 03:21 PM
Man, afternoon crush.....looks like the hold will continue...bring on my divy! LOL


LOL...The market didnt like that rate cut did they. I think they expected more. Ohh well.

BadThad
12-11-2007, 04:12 PM
ARRRGGGGGG.....)(*&%()*&#^@^%@! LOL Well, looks like we're getting a dividend! LMAO We'll be OK, just going to take some patience now, this is a solid company and the stock will come back.

ktavera
12-11-2007, 04:23 PM
if they had cut by 50 basis points this would have climbed. im in the red now...guess ill just have to hold until later in the week.

BadThad
12-12-2007, 10:58 AM
Just a reminder, the divy EX date is tomorrow, as long as we own the stock thru the morning, we will get the divy.

Looks like another day of getting hammered, under $16 now, we're going to have to ride it.

Buku
12-12-2007, 11:26 AM
Not complaining about the divy, thats for sure!

BadThad
12-12-2007, 11:37 AM
I just bought another 50@15.93, this is an amazing price. I might just hold this stock for a very long time with the divy....I love dividends and they normally pay a very nice one. Not to mention, this is a $40-50 stock beat down by subprime concerns.....even though they have NONE. LOL

ktavera
12-12-2007, 12:12 PM
I picked up 200 more at 16.05 this morning. I almost sold everything when it went up to 17.30 this morning. I should have sold and bought back in at the low prices we are seeing now. oh well. :D

Buku
12-12-2007, 02:51 PM
I wish I had more money so bad. At these prices, you are pretty much guaranteed to make some $$$ Currently $14.85

BadThad
12-12-2007, 02:57 PM
Dear God....when will it end? LOL I might just buy more, I can't believe this.

Not sure exactly why it's dropping, but there might be a connection with Sallie Mae reporting a loss of $344M and them having a bad outlook for next year. I think the whole market appears to have soured toward any educational lending companies, it must be. I don't believe there's ANY connection between FMD and Sallie Mae, they are competitors and FMD is doing well. :~/

http://news.moneycentral.msn.com/provider/providerarticle.aspx?feed=FT&Date=20071012&ID=7619082

BadThad
12-12-2007, 03:03 PM
Looking like a new low might be set here soon! The low is $14.50 and we're at $14.54 now. If it gets there, I'm in for another 100 shares! I hold this sucker for 10 years if I have to, especially if it returns to $40-50 PPS and pays 6.82% yield....CHACHING!

BadThad
12-12-2007, 03:16 PM
Also complicated by lending in general:

http://www.marketwatch.com/news/story/us-stocks-off-daily-highs/story.aspx?guid=%7B9C867456%2D3094%2D49F3%2D9935%2 DD37F3529F9EF%7D

BadThad
12-12-2007, 03:44 PM
WOW...new low of 14.01...I missed it, stupid work. LOL

Just nabbed more at 14.35! I'm feeling good about this bottom play! Don't fret, this will be back some day. :)

BadThad
12-12-2007, 04:05 PM
14.83 close....looks like the bloodbath is over after making a new low today. Man, I wish I could have grabbed some at 14.01!

BadThad
12-12-2007, 04:17 PM
I like this guys post on Google forums:

Yes it will bounce back, as Fair Value Calculation for this stock is
$42.00 based on S&P's proprietary quantitative model.


:D :D :D

BadThad
12-13-2007, 04:05 PM
Looks like the bottom is here, let's see what tomorrow holds for us.

BadThad
12-17-2007, 10:31 AM
The Marblehead is kicking my Knucklehead! LOL

ktavera
12-18-2007, 11:51 AM
since it broke down to this level, I think the bottom will be around 10.. maybe we will see it by the end of the week. :-||

BadThad
12-18-2007, 01:10 PM
Yea, we have to take a deep breath here or sell.....I choose to take a breath. LOL I have about 18 years to wait, so I'm going to hold. In fact, if the bear continues to eat the PPS up, I'm going to continue buying small chunks because FMD is as solid as it gets. Our money is safe and we must not panic because of this bear.

BadThad
12-19-2007, 01:08 PM
FMD a hot deal!

Weekly Guru Bargains Highlights: Ambac Financial Group Inc., Retail Ventures Inc., Radian Group Inc., TravelCenters of America LLC, CompuCredit Corp., The First Marblehead Corp
GuruFocus News
This week’s low gas prices pushed down off-shore company shares and retail shares hold the market strong through the last quarter of the year. The market is volatile as investors worry about economic recession. Related companies: Ambac Financial Group Inc. (ABK), Retail Ventures Inc. (RVI), Radian Group Inc. (RDN), TravelCenters of America LLC (TA), CompuCredit Corp. (CCRT), The First Marblehead Corp. (FMD).

Ambac Financial Group Inc. (ABK): Down 67% Since Chris Davis Bought In the Third Quarter
Bond insurer Ambac Financial Group, Inc. (ABK) stated that it will continue to review options to expand its capital position. This move gave investors the confidence that ABK has the ability to pay-off its claims. Analysts predict that the stock is currently undervalued. Late-November, there have been a push for a legislation that will freeze ARM mortgages; this will be good news for bond insurers.

While Chris Davis increased his ownership by 55.4% to 6,506,767 shares, both David Dreman and Dodge & Cox sold out their holdings in ABK. Tom Gayner,

Martin Whitman, and Third Avenue Management also owns ABK stock.

Insider buys were made between $25.25 and $41.85 as of November: Chairman, President and CEO, Director Robert J. Genader and Senior Managing Director Kathleen A. Mcdonough bought 10,000 shares each, Executive Vice President John W. Uhlein bought 7,500 shares, Director Thomas C. Theobald bought 4,000 shares, Director Michael A. Callen bought 3,000 shares, Senior Managing Director David W. Wallis bought 2,500 shares, Director Henry D. G. Wallace bought 2,250, and Senior Managing Director Thomas J. Gandolfo bought 1,000 shares.

Ambac Financial Group Inc. has a market cap of $2.74 billion; its shares were traded at around $22.81 with P/E ratio of 12.39 and P/S ratio of 2.34. The dividend yield of Ambac Financial Group Inc. stocks is 3.7%.

Retail Ventures Inc. (RVI): Down 67% Since George Soros Bought In the Third Quarter
Retail Ventures, Inc. (RVI) makes public its proposal to sell Value City. Despite a 7.3% same-store sales drop, the retail chain pulled a third quarter net income gain of $1.40 or $68.2 million, compared to a previous year loss of $0.72, or $34.1 million.

Guru George Soros bought 28,643 shares at an average of $12.60. Also, John Keeley owns 2,798,540 shares.

Retail Ventures Inc. has a market cap of $218.77 million; its shares were traded at around $4.16 with P/E ratio of 6.13 and P/S ratio of 0.06.

Radian Group Inc. (RDN): Down 64% Since Arnold Schneider Bought In the Third Quarter
Radian Group, Inc. (RDN), a mortgage insurer, reported a third quarter loss of $704. million, or $8.78 compared to an income of $112. million, or $1.36 in the previous year. The company made a write-off of $304 million on its sub-prime mortgage investment in C-BASS, a joint venture with MGIC Investment. The company’s share price is its lowest this year. Despite all the turmoil, the company declared their quarterly dividend of $0.02.

Arnold Schneider added to his holdings in RDN at an average price of $29.50 to 2,657,125 shares. Third Avenue Management owns about 20% of Radian Group. Bill Miller recently bought 3,800,000 shares. And, NWQ Managers and Jean-Marie Eveillard kept their RDN shares nearly unchanged.

In September, insider buys were made by CEO Sanford A. Ibrahim, who bought 15,000 shares at $17.13, and Director Herbert Wender, who bought 3,400 shares at $16.71.

Radian Group Inc. has a market cap of $872.31 million; its shares were traded at around $10.62 with P/S ratio of 1.27. The dividend yield of Radian Group Inc. stocks is 0.8%.

TravelCenters of America LLC (TA): Down 63% Since George Soros Bought In the Third Quarter
TravelCenters of America, Inc. (TA), a fuel service franchise, named its new CFO, Andrew Rebholz, to replace John Hoadley. The company’s third quarter net loss of $21.6 million or $1.56 is due to expense aggregated from their previous merger in late- 2006.

Since the last quarter, George Soros owns 104,100 shares, which he bought around $36 a share.

TravelCenters of America LLC has a market cap of $183.98 million; its shares were traded at around $13.2 with P/S ratio of 0.03.

CompuCredit Corp. (CCRT): Down 62% Since Mohnish Pabrai Bought In the Third Quarter
CompuCredit Corporation (CCRT), which offers credit products to sub-prime consumers, announced a third quarter loss of $53.2 million or $1.10, compared to a previous year net income of $38.8 million or $0.78. The company’s loss was due to increasing defaults. Early June, CCRT appointed Thomas R. Donahue to direct corporate communications and strategy.

Mohnish Pabrai added to his holdings between $20.81 and $33.8, with an estimated average price of $24.8. Currently, Pabrai owns 1,806,801. Bill Miller bought 1,200,000 shares of CCRT stock in the last quarter.

During last week, President of Credit Cards Division, Krishnakumar Srinivasan, bought 20,000 shares at $10.19. Also on 11/08, Srinivasan bought 9,600 shares at $10.83. Following, CFO J. Paul Whitehead III bought 25,990 shares of CCRT stock on 11/08 at $11.45. In July, COO Richard W Gilbert sold 62,500 shares at $35.23.

CompuCredit Corp. has a market cap of $465.60 million; its shares were traded at around $9.45 with P/S ratio of 0.74.

The First Marblehead Corp. (FMD): Down 62% Since Richard Snow Bought In the Third Quarter 09/30/2007
The First Marblehead Corporation (FMD), a student loan and service provider posted a third quarter net income increase of 19.7% to $168.8 million or $1.80 compared to a previous $141 million or $1.49. The company rise in income is owed to an increase in revenue by 25.4%, from $302.9 to $380 million. Due to market instability, the company announced that they will not securitize student loans this quarter.

Richard Snow owns 287,269 shares, and guru Chris Davis owns 1,781,950.

Since October, Director Stephen E. Anbinder made large sells totaling 150,000 shares between $14.42 and $40.01. Another sell was made by EVP and President of FMER, Andrew James Hawley, who sold 13,619 shares at $39.42.

The First Marblehead Corp. has a market cap of $1.27 billion; its shares were traded at around $13.55 with P/E ratio of 3.21 and P/S ratio of 1.34. The dividend yield of The First Marblehead Corp. stocks is 3.5%.

ktavera
12-20-2007, 11:32 AM
This thing just wont stop. down almost 9% already today. Maybe we will see some significant upside next year when they begin securitization of loans again. I'm going to keep buying once it gets down to $9 a share. Think this will be big next year.

BadThad
12-20-2007, 01:27 PM
This thing just wont stop. down almost 9% already today. Maybe we will see some significant upside next year when they begin securitization of loans again. I'm going to keep buying once it gets down to $9 a share. Think this will be big next year.

Oooo...it will be. I know this is painful, but worth the ride IMO. I'm going to "back the truck up" and double-up if this gets much lower. I have some significant cash set aside for bear protection and for reinvesting in hot buys like FMD.

BadThad
12-21-2007, 09:34 AM
HUGE HUGE NEWS! :D :D :D

First Marblehead Announces Strategic Investment by GS Capital Partners
9:14a ET December 21, 2007 (Market Wire)
The First Marblehead Corporation (NYSE: FMD) today has entered into a definitive agreement with GS Capital Partners ("GSCP") pursuant to which GSCP will invest up to $260.5 million equal to 19.99% of the shares currently outstanding upon closing of the transaction.

In conjunction with this strategic equity investment, Goldman Sachs has committed to offer the Company a $1 billion warehouse facility that will allow the Company to access a new source of funding for its business. This is a first step in utilizing other funding alternatives to further diversify and strengthen the Company's business model.

GSCP will invest $59.8 million today to acquire securities convertible into 5.3 million shares of Common Stock at a conversion price of $11.24 per share. Upon receipt of regulatory clearances and determinations, GSCP will invest up to $200.7 million to acquire additional securities convertible into up to 13.4 million shares of Common Stock, at a conversion price of $15.00 per share. The convertible securities are non-voting and have no coupon and a nominal liquidation preference. The securities to be acquired by GSCP will, on an as converted basis, represent 16.7% of First Marblehead's outstanding Common Stock. GSCP will not hold more than 9.9% of the Company's voting shares at any time. Under the terms of the agreement, GSCP will have the right to designate one member of the Company's Board of Directors. The second step of the transaction is expected to be completed during the Company's current fiscal year.

"The fundamentals of our business are strong, and we remain encouraged and excited about our growth prospects. We see strong demand for loans in our second fiscal quarter and continue to believe that private student loans are an important source of college funding.

"We welcome Goldman Sachs' equity investment and warehouse financing, and its validation of First Marblehead's unique business model," said Jack Kopnisky, Chief Executive Officer and President of First Marblehead. "Goldman Sachs' investment and financing provides our Company with additional capital resources to fund our long-term strategy. In the current market, we plan to continue to focus on prudent credit underwriting. We believe this will allow us to provide the greatest value to our shareholders, our clients, students and their parents, and to our employees."

Henry Cornell, a Goldman Sachs Managing Director, COO of Goldman Sachs' Principal Investment Area and Member of its Investment Committee, said, "GS Capital Partners has a long history of investing globally in financial services companies. Our investment in First Marblehead represents a long-term commitment and is consistent with our strategy of investing in market leaders with strong business models that should benefit from strategic relationships with Goldman Sachs. It also highlights our ability to move quickly and provide capital in the current period of market dislocation. We are pleased to support a leading provider of quality products and services exclusively to the private student loan market."

In order to preserve capital and maximize liquidity in challenging market conditions, First Marblehead's Board of Directors reviewed its dividend policy and decided to eliminate the regular quarterly cash dividend for the foreseeable future. The payment of dividends on December 21st will continue as previously declared.

First Marblehead also expects to make changes to the assumptions used in estimating the fair value of its service receivables at December 31, 2007. The Company expects these assumption changes to result in an aggregate pre-tax charge to its service receivables of approximately $170-$185 million or approximately 18-20% of the service receivables as of September 30, 2007. More than half of the adjustment results from estimated changes related to the future cost of variable rate debt and for the discount rate used in estimating the fair value of the service receivables. This adjustment reflects prudent changes in underlying assumptions. The final amount of the adjustment will not be determined until the end of the second fiscal quarter.

First Marblehead will host a conference call for investors today at 11:00 AM (December 21, 2007). Investors and other interested parties are invited to listen to the conference call by dialing (866) 271-5140 in the United States or (617) 213-8893 from abroad (pass code 46257682), or via a simultaneous internet broadcast on the Company's Web site at www.firstmarblehead.com, under Investors.

A replay will be available on First Marblehead's Web site for 14 days, beginning shortly after completion of the call. The replay will also be available for 14 days by dialing (888) 286-8010 from the U.S. or (617) 801-6888 from abroad, and entering the pass code 59878360.

First Marblehead was advised by Credit Suisse and WilmerHale LLP. GSCP was advised by Goldman Sachs and Cleary Gottlieb Steen & Hamilton LLP.

Additional information about this transaction will be available in a Current Report on Form 8-K to be filed with the SEC.

BadThad
12-21-2007, 11:06 AM
YES....up 41% already! GS like FMD for a reason, they are a smart company....this makes me more confident in my holdings. :)

ktavera
12-21-2007, 11:16 AM
I agree. i picked up another 100 shares this morning. us who bought in as it was dropping are doing well!

BadThad
12-21-2007, 11:40 AM
Merry Christmas to us chance takers! Up almost 50% today! :D

It takes a brave and crazy investor to drop money in a stock moving down, but sometimes it pays off! :)

ktavera
12-21-2007, 11:58 AM
It is always worth buying as a stock is going down if you know that it is a solid company that is only dropping because of an overreaction in the market. Thank you to goldman sachs for the early christmas present! :lol:

Klipper22
12-21-2007, 12:52 PM
Just crankin' now! Got in a few days ago at 13.65 and was looking to average down today. lol. That obviously didn't happen.

BadThad
12-21-2007, 12:54 PM
I feel like AUfan with his pink posts: LMAO

UP 71% 8-|:D

BadThad
12-21-2007, 12:55 PM
Just crankin' now! Got in a few days ago at 13.65 and was looking to average down today. lol. That obviously didn't happen.

WOW! Awesome for you! CONGRATS! :D

Klipper22
12-21-2007, 09:22 PM
WOW! Awesome for you! CONGRATS! :D

Even a blind squirrel finds a nut once in a while. lol

BadThad
12-27-2007, 01:19 PM
Interesting look at FMD:

http://www.fool.com/investing/general/2007/12/27/marbleheads-golden-opportunity.aspx

ktavera
01-11-2008, 12:54 PM
Anyone playing FMD the past couple of days? I got back in 500 shares a few days ago. Up 14% today!

BadThad
01-11-2008, 01:19 PM
I've been watching, but the financial plays still scare the bejesus out of me. If I was you, I'd take profits. I still like FMD, but this market is crazy.

ktavera
01-11-2008, 01:22 PM
I plan on closing my position today. I agree, financials are not good for long holds these days. Think im getting into DRYS or VMW next.

BadThad
01-11-2008, 01:24 PM
Good choices, DRYS is selling at a HUGE discount. VMW is making nice ups and downs daily. I've been playing it like a madman because of the wild swings. :D

BadThad
01-23-2008, 01:16 PM
Up almost 8% in this serious bear:

First Marblehead to Release Second Quarter Fiscal 2008 Financial Results, Host Conference Call on January 31, 2008
4:05p ET January 14, 2008 (Market Wire)
The First Marblehead Corporation (NYSE: FMD) today announced that it will release its financial and operating results for the three-month period ended December 31, 2007 after market close on Thursday, January 31, 2008. The Company will host a conference call at 5:00 p.m. EST that afternoon to discuss its results. Jack L. Kopnisky, Chief Executive Officer and President, and John A. Hupalo, Chief Financial Officer, will host the call.

Investors and other interested parties are invited to listen to the conference call by dialing (800) 573-4752 in the United States or (617) 224-4324 from abroad (pass code 41399597), or via a simultaneous internet broadcast on the Company's Web site at www.firstmarblehead.com, under Investors.

A replay will be available on First Marblehead's Web site for 14 days, beginning shortly after completion of the call. The replay will also be available for 14 days by dialing (888) 286-8010 from the U.S. or (617) 801-6888 from abroad, and entering the pass code 65910095.

BadThad
01-28-2008, 04:24 PM
Finished up again today, almost 7%....looks like people are building positions leading up to the earnings release. I don't believe the subprime mess is going to hurt them in earnings.

Today I heard talk that student loans are also going to experience credit tighting. The Gov backed loans will be more difficult to get and the alternative for the lower credit-worthy will have to be private loans at a higher interest rate. Not sure how this is going to affect FMD, but I suspect it will lead to even more money in their pockets since the Gov isn't involved with those type of loans. However, I believe there just might be less money available, so it could off-set. Anyone smarter than I wish to chime in?

BadThad
02-20-2008, 03:03 PM
FMD dropping to near it's all time low. Worth watching closely IMO.

BadThad
02-29-2008, 04:17 PM
Down to 12.03 after the big sell off today. The low is 11.01....it's getting close. Another stock worth keeping an eye on.

BadThad
03-10-2008, 12:51 PM
New low set today $9.20! 8-|

BadThad
04-08-2008, 09:41 AM
Huge BLOW today! Down 33%:

First Marblehead Statement on TERI's Petition for Reorganization Under Chapter 11
7:54a ET April 8, 2008 (Market Wire)
The First Marblehead Corporation (NYSE: FMD) today provided the following statement from Jack Kopnisky, the company's Chief Executive Officer and President.

"Late yesterday, The Education Resources Institute (TERI), a non-profit guarantor of private student loans, filed a voluntary petition for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court for the District of Massachusetts.

"The First Marblehead Corporation has been in a strategic alliance with TERI since 2001, pursuant to which the non-profit has been the exclusive third-party provider of borrower default guarantees for our clients' private student loans. TERI also guarantees the loans held by The National Collegiate Student Loan Trusts (NCSLT), the series of trusts we use in our securitization program. According to the filing, TERI is developing a long-term business plan so that it can continue its College Access Programs as well as its guarantee activities.

"First Marblehead is analyzing the implications of this filing on its lenders, investors, borrowers, as well as the NCSLT. We are committed to continuing to provide an integrated suite of services including product development, processing and securitization services. The company is working diligently on securing an alternative guarantor as well as structural solutions for loan default guarantees for future originations. In addition, we have adjusted our collection and underwriting strategies to adapt to the challenges presented by the turmoil in the capital markets and the current consumer credit cycle."

CactusPowered
04-08-2008, 11:51 AM
i wonder if this will recover at all today..

BadThad
04-08-2008, 01:19 PM
Looks to be bottomed out.....I might just jump in, seems more often than not, these plays seem to rally at some point. Hard to believe I was trading this stock not long ago in the $18 range!

BadThad
04-08-2008, 01:31 PM
OK, stock down 53%....I'm in, let's see where it takes me! :biggrin:

BadThad
04-08-2008, 03:18 PM
Definately bottomed out, chart is flat-lined almost all day. I think news of a new Guarantor will send this moving back north.

CactusPowered
04-08-2008, 03:59 PM
Definately bottomed out, chart is flat-lined almost all day. I think news of a new Guarantor will send this moving back north.

Dang. I have some funds waiting to settle. I'd really like to have gotten in today, cuz it'll probably jump like 10-15%+ tomorrow morning real quick. Oh well, congrats for getting in. I think you'll be happy come the next couple days.

BadThad
04-09-2008, 10:26 AM
Up 6% today! :biggrin:

BadThad
04-09-2008, 11:17 AM
Up 11%! :dance:

BadThad
04-09-2008, 01:00 PM
Dropped, had to sell.....green is green I guess. I might rebuy......let's see...

BadThad
04-09-2008, 02:30 PM
Still running down @ 4.74, looking for another bottom...

Back in at 4.82....let's go baby! :)

Goodlive
04-09-2008, 03:13 PM
Do you think it has a support @4.60 ?

BadThad
04-09-2008, 03:54 PM
I don't think it has any support except at ZERO.....this stock is extremely volatile in wake of what's going on. Who know's what's going to happen from minute to minute, it could tank and it could rise, high risk play.

BadThad
04-10-2008, 10:02 AM
OUCH! Huge drop of 35% today! :-||

CactusPowered
04-10-2008, 10:17 AM
OUCH! Huge drop of 35% today! :-||


bought a few on the dip @ $3.76...hope to see somewhat of a climb. maybe this will make up for VLNC :p Not really the best entrance at all...but hopefully it will recover some.

BadThad
04-10-2008, 10:32 AM
Excellent buy bro! It's already bouncing up QUICK, I bought another 100 on the dip. FMD is doing fine as a company, look at the fundamentals....they will rise again.

CactusPowered
04-10-2008, 10:53 AM
Excellent buy bro! It's already bouncing up QUICK, I bought another 100 on the dip. FMD is doing fine as a company, look at the fundamentals....they will rise again.

indeed! We just broke $4.00 :biggrin:

BadThad
04-10-2008, 11:07 AM
indeed! We just broke $4.00 :biggrin:

:dance:

CactusPowered
04-10-2008, 01:25 PM
Well, I decided to get some profits, so i closed my long @ 4.26 (in at 3.76). Not too bad for a stock that is still in the red for the day!

How long will you be in this one?

BadThad
04-10-2008, 01:54 PM
Well, I decided to get some profits, so i closed my long @ 4.26 (in at 3.76). Not too bad for a stock that is still in the red for the day!

How long will you be in this one?

I have no idea, I'm in at 4.64 so it looks like awhile. |-{

BadThad
04-10-2008, 01:54 PM
Some news out:

Student-loan company First Marblehead Corp. (FMD:first marblehead corp com
News, chart, profile, more
Last: 4.27-0.36-7.78%

1:31pm 04/10/2008

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FMD 4.27, -0.36, -7.8%) won't be using a $1 billion credit line offered by Goldman Sachs Group Inc. (GS:Goldman Sachs Group, Inc
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Last: 171.07-3.07-1.76%

1:31pm 04/10/2008

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GS 171.07, -3.07, -1.8%) because of the necessary regulatory approvals needed.
First Marblehead also said it expects to write down the value of residuals receivable when it reports first-quarter results because of the bankruptcy filing of loan insurer the Education Resources Institute Inc. The amount has yet to be determined, First Marblehead said in a filing with the Securities and Exchange Commission.
Goldman's private-equity arm, GS Capital Partners, made a commitment in December to invest up to $260.5 million in First Marblehead along with the credit-line commitment. It invested $59.8 million at that time, with the remaining up to $200.7 million to be done later.
But in light of the potential write-down, First Marblehead said Goldman may not invest that full amount because Goldman's total investment has to be capped at 25% of First Marblehead's shareholder equity. Remaining under that amount prevents Goldman from having to register as a financial-holding company under federal regulations.
Credit-market turmoil has severely damped First Marblehead's business. It packages student loans, most guaranteed by TERI, into securities. But First Marblehead has been unable to unload any loans into asset-backed securities since September.
The developments demonstrate the peril of investing in finance companies during the credit crisis. Several other investments have gone south lately - namely private-equity firm Warburg Pincus LLC's investment in bond insurer MBIA Inc. (MBI:MBIA Inc
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Last: 12.01+0.04+0.33%

1:31pm 04/10/2008

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MBI 12.01, +0.04, +0.3%) , hedge fund Citadel Investment Group's purchase of a stake in E*Trade Financial Corp. (ETFC) and Bank of America Corp.'s (BAC:bank of america corporation com
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Last: 38.00+0.07+0.18%

1:31pm 04/10/2008

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BAC 38.00, +0.07, +0.2%) investment in mortgage lender Countrywide Financial Corp. (CFC:Countrywide Financial Corp
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Last: 5.74+0.07+1.22%

1:31pm 04/10/2008CFC 5.74, +0.07, +1.2%) , which it later agreed to buy.
First Marblehead's shares recently traded at $4.05, down 12.5%. The stock dropped 37% Tuesday after the TERI bankruptcy filing was announced.

BadThad
04-10-2008, 03:47 PM
Somewhat negative news, but it spells out where FMD stands nicely:

NEW YORK -
First Marblehead Corp. will not be able to raise as much money from an investment by Goldman Sachs Group Inc. because of the turmoil in the bond market and the bankruptcy of a crucial partner, the student loan services provider said Thursday.

The Boston-based company's stock plummeted more than 20 percent to its cheapest trade ever.

First Marblehead helps banks like JPMorgan Chase & Co. and Bank of America Corp. package their student loans into bonds and sell them to investors.

Because the subprime maelstrom has scared buyers away from the student loan bond market, First Marblehead has been unable to facilitate a bond sale in the past six months. The company lost more than $115 million in the last three months of 2007.

To raise enough cash to stay afloat, First Marblehead has been counting on a white knight in the guise of a Goldman Sachs affiliate called GS Capital Partners. GS Capital in December agreed to buy up to $260.5 million in First Marblehead's stock and establish a credit facility to lend the company up to $1 billion.

This investment is now under threat for two reasons.

The first is a nonprofit organization called The Education Resources Institute Inc. that acts as a bulwark against losses on First Marblehead's student loan bonds. TERI is devoted to ensuring that students are able to borrow money to go to college.

The organization does this by promising to reimburse lenders if students default on loans. This helped First Marblehead because bond investors are more willing to buy student loan bonds as missed payments would be covered by TERI.

TERI guarantees $16.2 billion in student loans and has access to only $93 million in cash. Because of illiquidity and investors' newfound distaste for riskier types of loans, TERI was forced to file for bankruptcy protection in Massachusetts earlier this month.

This forces First Marblehead to try to find another guarantor for the loans. If the company cannot find one, it may have to cover the loans itself.

Second, First Marblehead assumes it will collect a certain amount in fees from student lenders pooling their loans into bonds. Because of the fallout from the TERI bankruptcy and the company's reorganization, the company may not be able to collect as much from these contracts.

First Marblehead wrote down the value of these contracts by $178 million in the fiscal second quarter, and the company in a Securities and Exchange Commission filing Thursday said it will probably have to write down more for the third quarter.

That could impair the Goldman Sachs investment because of a regulatory cap imposed by the Office of Thrift Supervision.

The GS Capital investment was broken into two components: an initial $59.8 million investment and a subsequent investment of up to $200.7 million.

The second piece of the investment was capped at a quarter of First Marblehead's stockholders' equity, or assets minus liabilities. First Marblehead at the end of 2007 reported stockholders' equity of $921 million.

Because of the write-down and the TERI bankruptcy, First Marblehead's assets may shrink by enough that $200.7 million will be more than a quarter of the company's stockholders' equity. To remain in compliance with the cap, the GS Capital investment will probably have to total less than $200.7 million, First Marblehead said.

First Marblehead also decided to cancel the $1 billion credit line to "facilitate the receipt of required regulator approvals and determinations."

Sandler O'Neill analyst Michael Taiano it is not clear why this lending facility was scuttled. Most likely, First Marblehead and Goldman Sachs could not agree on terms, he said.

The company's stock sank 59 cents, or 12.7 percent, to $4.04. The shares fell as low as $3.12, the cheapest trade since First Marblehead went public in 2003. The stock topped $45 a year ago.

"They need this money badly," Taiano said. "They need it in order to function."

Taiano said First Marblehead's $350 million cash hoard can sustain the company for a few more quarters, but beyond that it will need more money.

Theboundbook
04-14-2008, 05:43 PM
First Marblehead
By Jim Gillies (TMFCanuck)

Editor's Note: This update was written before today's announcement that First Marblehead would not be proceeding with the $1 billion warehouse facility. Look for the team's comments on this development on the First Marblehead discussion board.

Ouch. The news this week that First Marblehead's (NYSE: FMD) strategic partner and nonprofit loan guarantor TERI (The Education Resources Institute) has filed for Chapter 11 bankruptcy protection was obviously not well-received: The stock price took a one-day 37% dive. If First Marblehead is becoming Hidden Gems' victim of death by a thousand cuts, this is one of the deeper ones.

There's been considerable discussion on the First Marblehead board of the implications of the TERI bankruptcy filing, which I'll simply direct you to, rather than rehash here:

* Bill Mann (TMFOtter) provides additional notes on the situation.
* TMFSteppenwulf offers some courage.
* enoch01 discloses why he sold.
* MKArch mulls over the current situation.
* kmorley123 revisits the big picture.

I think the best advice to Foolish investors who are long Marblehead shares is to re-read Bill's most recent update in the March 2008 issue; essentially, this stock is a hold until some of the dust settles and we know how "Second Marblehead" evolves.

I'm not sure that the TERI bankruptcy was an entirely unforeseen event given the review and subsequent downgrade of its credit rating, and as Bill laid out in his post, this action is most likely an attempt to buy some time. If TERI plans to emerge from bankruptcy as a viable business, it likely will honor its Marblehead obligations. As such, I suspect Marblehead has few cash concerns at this point.

I also think the TERI bankruptcy has two implications for future Marblehead securitizations. First, other guarantors are out there and will be available ... for a price. Insurers like MBIA, Ambac, and XL Capital have effectively self destructed. Others, like Financial Security Assurance (NYSE: FSE), which largely avoided the whole CDO/structured finance mess, are now sitting pretty with a stable AAA rating and outlook, and no shortage of potential business. So an external guarantee is going to be pricy, which will affect Marblehead's future profitability. I also think the absence of (distrust in) TERI will put to rest the notion that there will be any near-term undercollateralized securitizations or the associated revenue.

A TERI bankruptcy work-out -- where its obligations are continued, and not abrogated -- does not change the actual prospective cash that will flow to Marblehead from its residuals, no matter what the present value on the upcoming balance sheet. Those cash flows are estimated to be more than a cumulative $1.9 billion. IF (note the caps) the original underwriting has been good and the prepayment and default assumptions hold, that's a tremendously valuable asset. And that paradoxically poses the biggest problem I see for Marblehead: If the underwriting is good, someone will buy the company, and if the underwriting is shown to be not-so-good, the value of the much-vaunted TERI database is impugned, and Marblehead is arguably deserving of its current state. Personally, I think Marblehead is probably takeover bait, and I'm looking at Goldman Sachs (NYSE: GS) as the likely suitor. If the demand for private student loans is as strong as so many have asserted over the past few years, and the players on the field have been winnowed to a struggling few, someone's going to meet that demand; sadly, I doubt it will be Marblehead.

CactusPowered
04-17-2008, 11:43 PM
Uh oh, Bank of America has pulled the plug on FMD...


First Marblehead Statement on Bank of America
3:03p ET April 17, 2008 (Market Wire)
The First Marblehead Corporation (NYSE: FMD) today provided the following statement from Jack Kopnisky, the company's Chief Executive Officer and President.
"Earlier today, First Marblehead was notified by Bank of America that due to the ongoing disruption in the capital markets it has decided to exit the private student loan business and focus on providing federal student loans. In connection with this decision, Bank of America has elected to exercise its right to terminate its agreements with First Marblehead due to the filing by The Education Resources Institute (TERI) of a voluntary bankruptcy petition on April 7, 2008.
"We appreciate the business relationship that we have shared with Bank of America to provide alternative private student loan solutions to students and their families. In the current economic environment, we understand and respect Bank of America's decision.
"First Marblehead remains passionate about its mission to provide private student loan solutions to help fill the gap between federal aid and the rising cost of college. We are committed to continue to work with lenders to provide an integrated suite of services including product development, processing and securitization services."
About The First Marblehead Corporation -- First Marblehead provides financial solutions that help students achieve their dreams. The Company helps meet the growing demand for private education loans by providing national and regional financial institutions and educational institutions, as well as businesses and other enterprises, with an integrated suite of design, implementation and securitization services for student loan programs. First Marblehead supports responsible lending for borrowers and is a strong proponent of the smart borrowing principle, which encourages students to access scholarships, grants and federally guaranteed loans before considering private education loans. For more information, go to www.firstmarblehead.com (http://www.firstmarblehead.com).
Statements in this press release regarding First Marblehead's future services, as well as any other statements that are not purely historical, constitute forward-looking statements for purposes of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based upon our plans and expectations as of April 17, 2008. The inclusion of this forward-looking information should not be regarded as a representation by us or any other person that the future results, plans or expectations contemplated by us will be achieved. You are cautioned that matters subject to forward-looking statements involve known and unknown risks and uncertainties, including economic, legislative, regulatory, competitive and other factors, which may cause actual performance, including future facilitated loan volumes, or the timing of events, to be materially different than those expressed or implied by forward-looking statements. Important factors that could cause or contribute to such differences include: the demand for, and market acceptance of the services we offer and loan programs that are not TERI-guaranteed; our ability to identify, and negotiate agreements with, alternative private student loan guarantors; our success in designing, selling and implementing alternative service offerings, including structural default reserves for future loans; our ability to facilitate the securitization of loans that are not TERI-guaranteed; our relationships with key clients, including their reaction to the TERI bankruptcy filing and related developments; and the other factors set forth under the caption "Item 1A. Risk Factors" in First Marblehead's quarterly report on Form 10-Q filed with the Securities and Exchange Commission on February 11, 2008. We disclaim any obligation to update any forward-looking statements as a result of developments occurring after the date of this press release.
https://research.ameritrade.com/gif/x.gifContact: Janice D. Walker Corporate Communications 617-638-2047 Lee Jacobson Investor Relations 617-638-2065
https://research.ameritrade.com/gif/x.gifSOURCE: The First Marblehead Corporation

BadThad
04-18-2008, 09:45 AM
Ouch!

Theboundbook
04-18-2008, 03:33 PM
Baby is still climbing..... Up .50 for me.....

BadThad
04-18-2008, 04:16 PM
What the hell? Dropped by one of the biggest banks and the stock rises? :~/

Jackson Vile
05-05-2008, 07:01 PM
This is a chart pattern that I am seeing a lot of so every time I see one I watch it, this one looks about ready. We will see tomarrow

BadThad
05-06-2008, 09:31 AM
I moved your thread Jackson. We already had an FMD thread in the stock forums.

- BT

Jackson Vile
05-06-2008, 10:41 AM
Sorry about that, to be honest I did not even do a seach and should have.

BadThad
05-13-2008, 04:13 PM
Time to reboot FMD! The PPS just keeps tanking day after day....let's find the bottom! :)

CHART (http://stockcharts.com/h-sc/ui?s=FMD&p=DAILY&b=5&g=0&id=p98903830986)

Yup, this puppy is in the gutter!

BadThad
05-14-2008, 03:17 PM
Bottom must be NEAR! New low of $3.00 set today!

BadThad
05-20-2008, 04:22 PM
Holding lower support around $3 strongly. This is going to bounce for sure, not sure how much, but it will due to shorts covering in 2-3 days. They are going to get burned on this one. Lots of them talking in other forums trying to get people to sell so they can hit their $2.50 target. hehehehehe....sorry....it sure looks like they are going to get burned on this one. I'm going to the ring the register when they start covering in a few days. I love battling them in the stock market, like a video game! :biggrin:

Theboundbook
05-21-2008, 04:04 AM
Holding lower support around $3 strongly. This is going to bounce for sure, not sure how much, but it will due to shorts covering in 2-3 days. They are going to get burned on this one. Lots of them talking in other forums trying to get people to sell so they can hit their $2.50 target. hehehehehe....sorry....it sure looks like they are going to get burned on this one. I'm going to the ring the register when they start covering in a few days. I love battling them in the stock market, like a video game! :biggrin:

What price r u looking to jump in....? I think this is about bottomed out and I think an option on this would be good too; for I think this could jump to 4.00 soon.... What do you think?

BadThad
05-21-2008, 08:52 AM
What price r u looking to jump in....? I think this is about bottomed out and I think an option on this would be good too; for I think this could jump to 4.00 soon.... What do you think?

I'm already in, I bought at ~ 2.98 when it bottomed out the other day. THIS IS A RISKY PLAY.....only play what you can afford to lose. That said, I'm looking for a rise to about $4 when the shorts start covering. The lower support has been amazingly stable that past couple of days.

BadThad
05-22-2008, 09:32 AM
HAHAHAHAHA....looks they are starting to cover! Up almost 10% already this morning. :)

BadThad
05-22-2008, 09:35 AM
Looks like an upgrade and some speculation for a take-over: :biggrin:

Student loan company First Marblehead Corp., despite losing key bank customers, is now a more attractive acquisition target for a buyer looking to buy the company's loan database and proprietary brands for what could be a small premium, an analyst said Thursday.

Friedman Billings Ramsey & Co. analyst Matt Snowling also upgraded his rating on First Marblehead shares to "market perform" from "underperform."

"... First Marblehead's loan volume will be just a fraction of what reported last year," Snowling said in a research note. "Nevertheless, we believe First Marblehead now presents a more attractive acquisition target for a buyer looking to purchase the loan database, platform and proprietary brands for what could be a small premium."

First Marblehead was trading near its cash value Wednesday. The stock closed Wednesday at $2.98, but rose nearly 4 percent in pre-market trading on Thursday.

BadThad
05-22-2008, 10:09 AM
Blog upgrade news:

First Marblehead (NYSE:FMD): Upgraded at FBR
The unthinkable has happened - FBR has upgraded First Marblehead (NYSE:FMD):

Rating goes to Market Perform from Underperform on belief that much of the bad news is baked into the stock, particularly with early indications of thawing within the private student loan ABS (SLABS) market. Notwithstanding the company's increased risk to its residual receivables following rising credit losses and TERI's bankruptcy filing, the firm no longer believes the risk/reward warrants an Underperform rating for First Marblehead shares at current levels, especially as derivative benefits might start to form, stemming from governmental efforts to provide funding to the federally guaranteed student loan market. Trading at 43% of stated tangible book and approximately at the cash on hand, they believe the shares reflect a near total impairment of the company's residual receivables. While further operating losses and possible liabilities related to the failure to securitize customer loans could drive the liquidation value to the company lower, we view the potential for acquisition and/or the eventual opening of the ABS market as balancing risks.

Assuming a 100% impairment of the company's existing residuals, thereby eliminating the financial exposure to its outstanding trusts, FBR calculates this will result in a pro forma tangible book of $2.85 per share. Though the company will continue to bleed cash until it is able to access the capital markets, they believe the company becomes increasingly attractive as a target for its loan database and origination platform—along with the nearly $2.95 per share of cash. Furthermore, in the event the securitization market opens up, the stock is set up for a potential squeeze with an estimated 22% of the float short. Balancing the upside, in their opinion, are the risk of cash burn, cannibalization from higher FFELP loan limits, warehouse refinancing uncertainty, and loss of loan volume from JPMorgan Chase, Bank of America, and RBS Citizens—which collectively represented 76% of the company's volume.

Notablecalls: FBR has been negative on FMD since 2006 and rightly so. With the firm stepping back from their negative stance I suspect we may see some considerable short covering (& even buying). The stock can be viewed as a call option here - JPM & BAC may actually return as clients when dust settles. If that happens FMD will be a $10+ stock again. Unless it gets bought in the n-t.

Limited downside and ample upside is what you get here. I'm taking it.

PS: My gut tells me FMD could do $3.25+ today.

Aufan 1983
05-22-2008, 11:08 AM
I waited too long but jumped in with you a little bit ago. In @ 3.55 Lets ride :lol:

Theboundbook
06-17-2008, 04:25 PM
Well I got in at 3.78 and have really been enjoying this ride... Will this hit 6 bucks? Who knows. I should have bought options when it was at 3.50 for a 5.00 strike. Big big money then!

Up to 4.46 with a big push in the last 10 min. of trading... Maybe some news comes out tomorrow and some people know about it!

Theboundbook
07-16-2008, 04:01 PM
Up 21.18% today. Heavy push at the end of the day. Not sure why. I sold a while back at 4.30 and have been waiting for the bounce. Got in 2 days ago at 1.74 and am quite glad I did. This is going to continue up but day traders will push it down with easy 20% profits to be made on days like this. Volume was down all day until the last hour where over half of the shares for the day were traded.

BadThad
07-17-2008, 10:03 AM
Dang, I missed that 1.65 low! Too many stocks to keep track of these days!

BadThad
07-17-2008, 10:03 AM
Up 21.18% today. Heavy push at the end of the day. Not sure why. I sold a while back at 4.30 and have been waiting for the bounce. Got in 2 days ago at 1.74 and am quite glad I did. This is going to continue up but day traders will push it down with easy 20% profits to be made on days like this. Volume was down all day until the last hour where over half of the shares for the day were traded.

1.74....CONGRATS! :dance:

BadThad
08-18-2008, 11:55 AM
News out about CEO:

First Marblehead brings back CEO Meyers (http://money.cnn.com/news/newsfeeds/articles/apwire/13ce07cceb21ca0e6166da2225bf391d.htm)

BadThad
11-06-2008, 03:24 PM
Earnings....really, not as bas as I thought they would be. Out of all this mess, the good thing I see is they have $222 million in cash. Other than that, I'm surprized they are keeping afloat.

First Marblehead Announces First Quarter Fiscal 2009 Results
5:03p ET November 5, 2008 (Market Wire)
The First Marblehead Corporation (NYSE: FMD) today announced its financial and operating results for the first quarter of fiscal 2009, which ended on September 30, 2008.

Total revenues for the first quarter of fiscal 2009 were $(84.9) million, down from $380.0 million for the same period last year. Revenues declined principally as a result of the illiquidity in the financing market for private student loans. The company did not complete a securitization transaction during the first quarter of fiscal 2009, while it completed two securitizations during the first quarter of fiscal 2008. In addition, non-cash adjustments made to the discount rate and default assumptions used to estimate the fair value of the company's service receivables, net of time value accretion, resulted in a $98.0 million pre-tax reduction in revenues during the first quarter of fiscal 2009. Processing fees during the first quarter of fiscal 2009 were $2.4 million, compared to $46.2 million during the first quarter of fiscal 2008, reflecting a decrease in loan facilitation volume during the fiscal 2009 period.

The net loss for the first quarter of fiscal 2009 was $92.9 million, or $0.94 per share, a decrease from net income of $168.8 million, or $1.80 per diluted share, for the same period last year. The decrease in non-interest expenses during the first quarter of fiscal 2009 reflected the company's recent expense reduction initiatives, partially offset by a $21.2 million expense relating to an unrealized loss on the company's portfolio of education loans held for sale. Compensation and benefits expense decreased to $15.3 million during the first quarter of fiscal 2009 compared to $32.0 million during the first quarter of fiscal 2008. General and administrative expenses decreased to $24.4 million during the first quarter of fiscal 2009 compared to $65.5 million during the first quarter of fiscal 2008.

Loans facilitated decreased to $128 million during the first quarter of fiscal 2009 compared to $2.4 billion during the first quarter of fiscal 2008. Loans facilitated and available for securitization decreased to $83 million during the first quarter of fiscal 2009 compared to $2.2 billion for the first quarter of fiscal 2008. Loans available for securitization as of September 30, 2008 increased to $2.4 billion, from $1.1 billion as of September 30, 2007. The company does not expect to complete a securitization in the near term.

In August 2008, the company received $132.7 million in gross proceeds from the sale of shares of preferred stock to affiliates of GS Capital Partners.

Daniel Meyers, First Marblehead's Chief Executive Officer and President, said, "The illiquidity of the capital markets continues to negatively impact our financial results. We have scaled back expenditures significantly to reduce our operating costs. We are focusing our efforts on our core businesses -- the design, origination, financing and risk management of private student loan products and services. The completion of the GS Capital Partners investment adds to our financial strength and flexibility as the company closed the quarter with $222 million in cash, cash equivalents and investments on the balance sheet."

Meyers added, "Challenging economic times such as these create opportunities that well positioned firms can take advantage of through knowledge, hard work and industry expertise. The strategic realignment and management changes we have undertaken are positioning the company to lead the next product cycle and compete in the newly emerging private student loan marketplace."



Current PPS: $1.46

BadThad
11-18-2008, 02:46 PM
Current PPS: 80 cents

What is up with this piece of ######## ? I know someone who loaded up at $2.50


They are in a world of $hit. However, TARP may end up bailing them out. I've heard a "student loans" mentioned a few times by Paulson. They are going to need a lifeline soon!

BadThad
12-01-2008, 03:11 PM
This might actually be a playable stock. I'll get back in if we see the PPS drop to <$1, it's close to that today at $1.13. They do have a decent amount of cash, so I think they'll stay afloat. The stock PPS has taken some wild swings, which I think are playable.

thegreatgate
03-10-2009, 08:08 PM
Thad---I check the price of this stock almost daily and I was going to remind you about FMD <$1 when it broke a couple of weeks ago but the stock to me is kind of pathetic so I didn't say anything. It does seem to always bounce to the $1.30-$1.50 range so even at 94 cents it is not a bad play. My bro has been in this since Octoberish at $2.50/share.

It had a real nice day today--- Up 32.39%

BadThad
03-11-2009, 08:17 AM
Thad---I check the price of this stock almost daily and I was going to remind you about FMD <$1 when it broke a couple of weeks ago but the stock to me is kind of pathetic so I didn't say anything. It does seem to always bounce to the $1.30-$1.50 range so even at 94 cents it is not a bad play. My bro has been in this since Octoberish at $2.50/share.

It had a real nice day today--- Up 32.39%

Thanks bro. I'm surprized this company just keeps haning on. Haven't done any DD on the lately, not sure if there's anything promising for them in the future.

BadThad
04-06-2009, 11:54 AM
Stock up 26% after this news:

First Marblehead Sells Selected Trust Residuals, Expects Reduced Future Tax Obligations and Tax Refund
9:10a ET April 6, 2009 (Market Wire)
The First Marblehead Corporation (NYSE: FMD) announced today that it has sold its ownership interest in NC Residuals Owners Trust (the "Trust"). The Trust is the owner of the residual interests in all fifteen of the National Collegiate Student Loan Trusts ("NCSLT") which First Marblehead has facilitated. This transaction does not affect any of First Marblehead's interests in securitization trusts relating to its GATE transactions. The Company was advised on the transaction by Deutsche Bank Securities Inc., Orrick, Herrington & Sutcliffe LLP and Sonnenschein Nath & Rosenthal LLP.

The sale is expected to generate a cash refund for taxes previously paid, as the Company has been required to pay taxes on the expected residual cash flows from the NCSLT Trusts before it actually receives those cash flows. Prior to this transaction, the company has paid in excess of $195 million on taxable income associated with their interests in the NCSLT residuals over the past 7 years. The Company estimates that it would be required to pay approximately $430 million in additional taxes over the remaining life of the residuals, with approximately $370 million to be paid prior to the residuals generating sufficient annual cash flows to offset the tax payments. As a result of the transaction, the Company expects to eliminate any tax obligations from these residuals in their entirety.

The refund is expected to be received by the Company in 2009 and 2010.

The Company has also entered into an Asset Services Agreement with the purchaser of the Trust pursuant to which the Company has agreed to provide certain portfolio services for an annual fee based on the aggregate outstanding principal balance of the student loans owned by the NCSLT Trusts. The advisory fee will be earned but will not be paid until residual cash flows are distributed by the NCSLT Trusts. If First Marblehead completes its obligations under the Asset Services Agreement as anticipated, the Company expects total revenues between the years 2009 and 2038, to be approximately $500 million, on an undiscounted, pre-tax basis, using current management assumptions regarding loan performance.

First Marblehead continues to have rights to additional structural advisory fees from the NCSLT Trusts and will continue to publish on its website its management assumptions as well as static pool data regarding performance of these trusts. In addition, First Marblehead Data Services, Inc. will continue to serve as administrator of the NCSLT Trusts.

Daniel Meyers, First Marblehead's Chief Executive Officer and President, said, "Management is pleased to have completed this transaction, which will significantly enhance our unrestricted cash. With respect to the residual interests, the Company has paid income taxes on these residual interests without receiving any cash from these trusts. By completing this transaction, we expect not only to stop the cash burn from these tax payments, but also to recapture a significant portion of the taxes that the Company has paid to date on these residuals. In addition, we will assist the Purchaser with a host of portfolio management and data services throughout the life of the NCSLT Trusts, for which we expect to receive contractual fees. This ensures that First Marblehead's interests continue to be aligned with those of the bondholders of these trusts."

Meyers continued, "As we begin to see the rationalization of the credit markets, First Marblehead will facilitate loans to students in the private education finance market, working with partners to produce products and portfolios that are in line with evolving funding conditions. We are actively engaged in advising clients, administering trusts, originating third-party loans and structuring new and innovative products. Having materially more unrestricted cash at our disposal makes the firm substantially stronger during these turbulent times."

The Company has filed with the Securities and Exchange Commission a current report on Form 8-K with additional transaction details.

greencat
04-19-2010, 09:22 PM
FMD made a new higher high today.

FMD Chart
http://www.profitspi.com/stock-chart-str.aspx?id=FMD&ca=2127743265

BadThad
12-09-2010, 09:10 AM
Saw this interesting tidbit this morning:

Dec 09, 2010 (SmarTrend(R) News Watch via COMTEX) -- Below are the top five companies in the Consumer Finance industry as measured by their Debt To Asset ratio.

The Debt/Asset ratio shows the proportion of a company's assets that are financed through debt. If the ratio is greater than one, most of the company's assets are financed through debt.

#1 First Marblehead (NYSE:FMD) has a Debt/Asset ratio of 1.07x based on total debt of $8.8 billion.

greencat
09-10-2013, 06:07 PM
FMD rolled down off a bearish head and shoulder pattern. I am looking for a nice bounce here on FMD.

FMD Chart
http://stockcharts.com/c-sc/sc?s=CDNS&p=D&yr=1&mn=0&dy=0&i=t41239524638&r=1378850528115
http://www.profitspi.com/stock-chart-str.aspx?id=FMD&ca=1622109647