Ambac 1Q08 earnings call on Wed Mar 23

Ambac Financial Group, Inc. (NYSE:ABK) (Ambac) announced that it will host a conference call for investors on April 23 at 11 a.m. Eastern to discuss first quarter 2008 earnings which are scheduled to be released at 6 a.m. that morning. The dial in number for the call is 877-407-0782 (U.S.) and 201-689-8567 (outside the U.S.).

Participants may submit questions in advance of the call by sending an email to 1Q2008earnings@ambac.com.


Last time Ambac had their conference call, all hell broke loose (actually it was their advanced earnings announcement but the conf call didn't exactly calm down anyone)... hopefully things will be better this time around ;)

The key things to watch:


  1. New loss reserves: I'm sure there will be some additional reserves taken for losses but as long as it is very small (I'm thinking less than $200m) it would satisfy me.
  2. HELOC and CES performance: In addition to the CDO-squareds, the other potentially lethal problem is HELOCs and CESes. The problem is that losses will likely be (close to) 100% with these exposures; in contrast, a typical RMBS and CDO likely has some positive recovery value (say 30% to 80%). The potential for massive losses for HELOCs is one reason MBIA sometimes posts worse theoretical losses than Ambac in some rating agency stress tests.
  3. New business: Market share dropped to 1% in the first quarter so that's not news but the real question is whether they were able to write any new business. Ambac was shrouded in a cloud for the first two months but I am curious to know how things looked late in March as well as early April.
  4. Foreign business: They may not break it out but I'm curious to see if there is some new business in the foreign markets.


Stay tuned for another chapter in the life of Ambac...

Comments

Post a Comment

Popular Posts

Thoughts on the stock market - March 2020

Image
Right now, DJIA has a P/E of 16.8 and forwand P/E of 15.1, whereas S&P 500 is at 20.1 with forward P/E of 15.8. Source: WSJ market Data If you ignore interest rates and inflation expectations--both of these influence valuations but depends on your macro call-- the market is not cheap. Long-term P/E is around 15. Trailing P/E is around 20% (Dow) to 40% (S&P500) higher than average. Forward P/E is in line with long term average but that assumes a strong V recovery. Consensus forecast is for profits to drop 1.2% in 2020. In 2008, it dropped 25.4% so current forecast is a very mild recession. Covid-19 coronavirus is not going to last more than a few months but these forecasts are still too rosy in my opinion. So I wouldn't rely on forward P/E. The richly valued (mostly tech or high quality) have not fallen much but the distressed ones have. So if you want to outperform in the long run, I think one’s choice right now is to: • Wait for market to fall another, say
✖ READ MORE >>>

Warren Buffett's Evolution and his Three Investment Styles

Image
A Young Warren Buffett In a comment to one of my posts , Mark Carter, who incidentally appears to have a  good blog worth checking out , asked: "Buffett Prime is 1970's to early 1990's" Could you elaborate? I have vaguely indicated how I view Warren Buffett in the past, but I thought I would detail my view of his investing behaviour. This is more of an opinion piece and many others would disagree with me (if you do, I'm curious to hear your thoughts). I don't follow Warren Buffett as closely as many value investors so I may get some facts wrong. My view is that Warren Buffett went through three different phases, with each consisting of different investment techniques. The overall investment theory remained the same—what people call value investing—but his execution, tactics, and strategy differs across the three phases. Some people may break up his career into additional periods but my feeling is that the three I will describe essentially capt
✖ READ MORE >>>

Hugh Hendry discussion at the Alternative Investment Conference

Thanks to Value Investing World for bringing this Hugh Hendry interview to my attention. I may not agree with all the things—short-term orientation of hedge funds is actually worse IMO; the sharp pencil effect doesn't always work—but Hendry is a true contrarian and worth listening. Like Marc Faber or Jim Rogers, you also can't take everything Hugh Hendry says seriously. I had always felt Hugh Hendry was firmly in the deflation camp but I get the feeling that he is now opening up to high-inflation possibilities. Otherwise, his stance appears to be similar to past opinions.
✖ READ MORE >>>