NYSE:FNM
$0.99
(2/9 3:13PM)
| Open | $0.99 |
Mkt Cap | $1.1 Billion |
| High | $1 |
52Wk High | $2.13 |
| Low | $0.98 |
52Wk Low | $0.35 |
| Volume | 6.7 Million |
Avg Vol 10D | 14.5 Million |
A Word Of Caution
The Ockham Research Team has placed an alert on this security because there have been significant developments associated with Fannie Mae (FNM). Eventually, these externalities may have an impact on our valuation but these recent events have not yet been fully factored into our analysis.
Please take a moment to look at the RazorWire feed on the right hand side of the report. Each mention of Fannie Mae on business television or influential blogs will be displayed to the right of the report. This should help bring you up to speed on any major issues they are facing right now.
Of course, you may proceed to review our research report for this security, but please be aware that our model may not reflect these significant factors surrounding this company as our data sources are still being updated. This alert shall remain in effect until the situation surrounding this security normalizes substantially.
Therefore, (and as always), check additional sources and available information regarding FNM before making an investment decision.
Ockham's Rating/Recommendation Summary
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FNM Revenue
Cash earnings is the most important factor in our analysis, but it goes without saying that if a company cannot produce sales then there is no ability to generate cash flow. By that logic we look very closely at revenue numbers as our second most important factor in valuing a company's stock. We have established reasonable Price to Sales per share ranges based on historical data of the last 10 years. For, FNM the high and low end of the Price to Sales per share ratios are 1.18x and 0.61x respectively.
Notice that FNM's current Price to Sales per share ratio is 0.02x, which is quite a bit below what we consider a normal Price to Sales ratio for this stock. Given normal conditions and a price of $0.97, FNM is 98% below where we would expect to see it. This will beneficially factor into our final analysis of FNM as it is not often that this stock sinks to these levels.
FNM Cash Earnings
FNM is not forecasted to produce positive Cash Earnings this year, based on recent performance. This is not a positive situation, as we would always prefer that a company is producing cash every year. However, it is important to recognize that not all companies or types of companies have the goal of producing positive Cash Earnings either early in their business cycle or following significant turnaround changes. When looking at FNM, we hesitate to be overly negative on the company, but it is of concern that the company is not profitable at this time.
Let's face it, companies cannot remain unprofitable for very long before a change has to be made. This could mean further restructuring or corporate event such as selling assets or spinning off divisions, at any rate a company with negative cash flows is not one that often makes a great investment unless you can acquire it at an extremely depressed price.
FNM Dividends
When determining a company's future prospects for success, Ockham Research sees analysis of dividend payments as a key additional factor. Even though it isn't imperative for FNM to shell out a dividend in order to receive a positive rating, it can be helpful to further our analysis.
Check Out Zero Hedge and News on FNM
Fannie Mae is one of the thousands of companies that Ockham has news analytics on, and it was recently discussed on Zero Hedge.
The Ockham valuation currently has a Fairly Valued stance on FNM because it trades within the price range that we would expect given current market conditions and fundamentals. Interestingly, overall sentiment looks bearish according to the Motley Fool's CAPS survey, as most of their users see Fannie Mae underperforming. At Ockham, we rank each stock by the amount of news coverage we see from RazorWire news analytics, and Fannie Mae has not seen a major ranking change recently.
“… The bailout of Freddie Mac and FANNIE MAE is almost certain to devalue all currency in the world (paper currency). ” I further stated in that same bulletin: ... …”
FNM and Analysts' Opinion Discussed on Zero Hedge
When the television or blog talks about an analysts' opinion it could have a major impact on the stock.
At Ockham, we rank each stock by the amount of news coverage we see from RazorWire news analytics, and Fannie Mae has not seen a major ranking change recently. The Ockham valuation currently has a Fairly Valued stance on FNM because it trades within the price range that we would expect given current market conditions and fundamentals. Interestingly, overall sentiment looks bearish according to the Motley Fool's CAPS survey, as most of their users see Fannie Mae underperforming.
“… Furthermore, I stated that my price target for FANNIE MAE, then trading at $19, was $4 (an estimate that, by the way, turned out to be far too generous). …”
More News Than Normal on FNM from Zero Hedge
FNM has been one of the most active stocks in the news today, so investors in it will want to pay attention to what is happening.
In comparing news flow statistics for the various companies we follow through RazorWire, we can tell you that FNM ranks just about where it normally does. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on FNM. The crowd at The Motley Fool does not like FNM and believes that it will Underperform.
“… to the public about the dire circumstances of their financial health just as Hank Paulson and the CBO lied to us about the financial health of FANNIE MAE and Freddie Mac in 2008 ... …”
FNM Having an Active Day in News, Now on Zero Hedge
We are observing a lot of attention being paid to FNM in the news, so if you hold the stock you may want to take a look at what is going on.
The Ockham valuation currently has a Fairly Valued stance on FNM because it trades within the price range that we would expect given current market conditions and fundamentals. Interestingly, overall sentiment looks bearish according to the Motley Fool's CAPS survey, as most of their users see Fannie Mae underperforming. At Ockham, we rank each stock by the amount of news coverage we see from RazorWire news analytics, and Fannie Mae has not seen a major ranking change recently.
“… In early 2007, Citigroup, FANNIE MAE and Freddie Mac comprised just 1% to 3% of the daily NYSE composite volume. In August of 2009, for weeks on end, Citigroup, FANNIE MAE, ... …”
Zero Hedge: What is Happening with Fannie Mae Now?
News has broken via the television and viral blogs regarding FNM, so investors should take an interest in learning what was said.
As we analyze the results from RazorWire, one thing we do is rank each stock in terms of amount of news coverage. Recently, FNM has been less covered in the news compared to the rest of our universe of stocks. The crowd at The Motley Fool does not like FNM and believes that it will Underperform. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on FNM.
“… The bailout of Freddie Mac and FANNIE MAE is almost certain to devalue all currency in the world (paper currency). ” I further stated in that same bulletin: “FANNIE ... …”
FNM and Analysts' Opinion Discussed on Zero Hedge
When the television or blog talks about an analysts' opinion it could have a major impact on the stock.
As we analyze the results from RazorWire, one thing we do is rank each stock in terms of amount of news coverage. Recently, FNM has been less covered in the news compared to the rest of our universe of stocks. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on FNM. The crowd at The Motley Fool does not like FNM and believes that it will Underperform.
“… health, not the disingenuous lies told to us by the likes of Hank Paulson and others, I told my subscribers that the likely final bailout cost of FANNIE MAE and Freddie Mac would ... …”
FNM News Mentioned on Zero Hedge Recently
The latest news from business television and influential blogs is always available through Ockham's RazorWire, and this news is in relation to Fannie Mae.
When taking into account the amount of news coverage each stock normally sees as a percentage of the total, Fannie Mae has actually sunk a bit in comparison to the others. Interestingly, overall sentiment looks bearish according to the Motley Fool's CAPS survey, as most of their users see Fannie Mae underperforming. The Ockham valuation currently has a Fairly Valued stance on FNM because it trades within the price range that we would expect given current market conditions and fundamentals.
“… lying to the public about the dire circumstances of their financial health just as Hank Paulson and the CBO lied to us about the financial health of FANNIE MAE and Freddie Mac in ... …”
Interested in FNM? See What the Pundits Said on Zero Hedge
Fannie Mae is one of the thousands of companies that Ockham has news analytics on, and it was recently discussed on Zero Hedge.
Fannie Mae receives our Fairly Valued rating in our latest report because the current price does not seem out of line with the fundamentals. We noticed recently that in comparison to all other stocks we analyze in the news; FNM has received less coverage from the financial media in business television and blogs. While bearish sentiment on a stock is not always a bad thing, it is something you need to be aware of. The Motley Fool survey of crowd sentiment shows that many investors believe this stock will underperform.
“… In early 2007, Citigroup, FANNIE MAE and Freddie Mac comprised just 1% to 3% of the daily NYSE composite volume. In August of 2009, for weeks on end, Citigroup, FANNIE MAE, ... …”
Fox Business Covers Fannie Mae and Regulators in Same Segment
RazorWire news analytics has noted a discussion of FNM that may be related to a regulators or the Fed on Fox Business.
In comparison to the other stocks that we follow, Fannie Mae has seen more discussion in relation to its normal ranking among the group. Be aware that the news sources we track are focusing on this stock more often these days. Interestingly, overall sentiment looks bearish according to the Motley Fool's CAPS survey, as most of their users see Fannie Mae underperforming. The Ockham valuation currently has a Fairly Valued stance on FNM because it trades within the price range that we would expect given current market conditions and fundamentals.
“… Test in the market since last fall, is it big enough to handle that action, could the fed unload the mortgage-backed securities that they took from FANNIE MAE and freddie mac ... …”
Dividends and Fannie Mae Among the Topics Covered on Fox Business
Dividends are a management decision and can be seen as a signal of strength or weakness depending on the latest news. RazorWire captured a discussion of FNM's dividends recently on Fox Business.
The crowd at The Motley Fool does not like FNM and believes that it will Underperform. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on FNM. When looking at our entire coverage universe and ranking stocks by the attention they receive on RazorWire, it is clear that Fannie Mae has been talked about more than normal recently.
“… The president's budget assumes FANNIE MAE and freddie mac will need $4 million more in taxpayer investment. After that the white house assumes FANNIE MAE and freddie mac will ... …”