Financial Business Review: American Express and Genworth Financial Catch Some Love
BTIG begins coverage of Genworth Financial (NYSE:GNW) with a Buy rating, as the analyst opines that the share price is undervalued. Reasons cited include Genworth’s ample liquidity, solid capital position, moderate leverage, adequate reserves and the improving trajectory of its operations. While BTIG acknowledges that the firm’s mortgage insurance division is generating some challenges, it forecasts that Genworth is set to return to positive margins next year.
Barclays raises its target price for American Express (NYSE:AXP) from $60 to $70, which is approximately 23 percentgabove current levels, and shares move upwards. Reasons offered for the move include a forecast that next week’s first quarter earnings report will show $1.03 per share, which would be $0.03 above consensus; and also that the market underestimates American Express’ expense leverage and the feasibility of its 8 percent long-term revenue growth target.
Earnings Report: The Charles Schwab Corp First Quarter Earnings Sneak Peek.
A valuation of between $7.5 billion and $8 billion is the target of private equity firm Carlyle Group (CARL), when it intends to offer 10 percent of the company at its initial public offering, which could take place as soon as next week. First, Carlyle is monitoring what comes from Tuesday’s scheduled listing of rival Oaktree, which hopes to raise some $517.5 million.
Possible solutions exist for some ‘problem loans’ belonging to Fannie Mae’s (FNMA.OB) and Freddie Mac’s (FMCC.OB) portfolios, but those solutions would become the Treasury’s (and the taxpayers’) problems. FHFA Acting Director Edward DeMarco said Tuesday that the institutions could save $1.7 billion by forgiving principal on the loans, but taxpayers would lose $2.1 billion because the savings on principle would come from Treasury incentives via the expanded Home Affordable Modification Program, using TARP funds.
Investing Insights: Citigroup, Inc. First Quarter Earnings Sneak Peek.