Fannie Mae-No Politics (FNMA)

[contrarian bull]

what value do you place on F and F

This has been gone over many times with some variation... but to summarize my opinion:

Value of fnma after release:

$20 if warrants are exercised and full payment is made to buy back senior preferred with no credit for sweep payments already made.

$100 if warrants are not exercised, full payment made, no credit for sweep payments.

$250 if warrants are not exercised, full payment made, full credit for sweep payments.

$400 if warrants not exercised, senior preferred are forgiven, sweep payments are refunded.

If you take into account odds of each scenario above happening and the time before that happens - current value of F&F is about $25.

As a contrast - the value of junior preferred in all 4 cases is $25 (or $50 for some) Maybe twice that in the extremely unlikely event F&F are required by courts to pay dividends they suspended back in 2008 or so.