Thornburg Mortgage Finally Cracks
Originally Published March 3, 2008 12:30 PM
Larry Goldstone of Thornburg Mortgage has been quite frank over the past six months discussing the challenges he faces, but is running out of time to pull a rabbit out of his hat, and Citigroup is pulling the plug on its rating, moving to a sell:
Thornburg Mortgage Inc. lost more than half its market value after the home lender failed to meet $270 million of margin calls and a Citigroup Inc. analyst said bankruptcy is possible.
Thornburg fell $4.98, or 56 percent, to $3.92 at 12 p.m. in New York Stock Exchange composite trading. The Santa Fe, New Mexico-based company, which has struggled with falling prices for mortgages since the middle of 2007, may try to raise money by selling debt, equity or securities holdings, according to a statement today.
``Another downturn in the market could lead to significant risk to the company; a more dire turn in the market could lead to bankruptcy,’’ Citigroup analyst Donald Fandetti wrote in a note to investors today. Fandetti cut his rating on the stock today to ``sell’’ from ``hold’’ and slashed his 12-month price target to $5 from $12. Bloomberg
Gladstone is the polar opposite of Angelo Mozilo, but this credit environment is taking no prisoners, and even the good guys are going down.
Thornburg Drops as Citigroup Sees Possible Bankruptcy
Bloomberg
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