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Sep-1-2008

Fannie Mae and Freddie Mac stock analysis

The past week has been very positive for FRE/FNM . Freddie Mac (stock ticker: FRE) gained 60% last week, and Fannie Mae (stock quote: FNM) gained 41%.

I will list the positive points sequentially below with links explaining why these mortgages companies are a strong buy right now:

1.Naked shorting soon to be banned permanently and the ban enforced.
http://www.cnbc.com/id/15840232?video=833966553


2.The intense and “urgent” negative media campaign by those hedge funds wishing to aquire the 5 trillion in assets of FRE/FNM for nothing has failed
http://online.wsj.com/article/SB121979831489375015.html?mod=hps_us_at_glance_columnists


3. Many big funds have much increased their FRE/FNM holdings including Lehman, Credit Suisse, Citi, and UBS
http://www.mffais.com/fnm.html

4. The debt Offerings of FRE/FNM have sold well
http://www.bloomberg.com/apps/news?pid=conewsstory&refer=conews&tkr=FRE%3AUS&sid=aK4fcq0RlHGA


5. FRE/FNM profit rises with debt costs
http://www.bloomberg.com/apps/news?pid=20601087&sid=a17G1.vWMkuU&refer=worldwide


6.Both parties and both Presidential candidates support FRE/FNM as currently constituted i.e. shareholder owned with common stock
http://www.marketwatch.com/news/story/obama-says-fannie-freddie-cant/story.aspx?guid=%7B6EECCC9D%2DC04F%2D48E5%2DB6D0%2D2E592D87AD4C%7D&dist=hplatest


7. New Housing bill Comes online Oct 1 allowing 120% fixed rate financing after a new appraisal.
http://www.govtrack.us/congress/billtext.xpd?bill=h110-3221


8.Nationalization unlikely
http://www.reuters.com/article/marketsNews/idUKBNG27011920080825?rpc=44


9. Price increase pps from 2.77 to 4.51 last week
http://finance.yahoo.com/echarts?s=FRE#chart1:symbol=fre;range=5d;indicator=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined

Hope this was useful for some of you. For a free stock analysis, please contact us at info@quickstockanalysis.com

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