Well tons of upside here, New Mexico economy far stronger then the rest of the nation so should lead the economic recovery. If I didn't think the company would survive I would not be here in fact i think the worst is behind them and will thrive.
No they don't per say need money, the bank itself is adequately capitalized, the holding company is under just by its tier 1 rating. In my estimation they need around 20 mil to restore the tier 1 rating. However they don't have any deadline to do this.
Now please read past posts and you might gain some clues to what might be coming, keep in mind picking the regional banks that will survive is the way to make big bucks going forward and Fsnm has 150 mil in cash and a a current book value around 4. There is only 20 mil shares out there. Now they might be bought out, and if that happens it should be near the book. Also that book value should go up as soon as the pres signs that Nol carry back provision attached to the home buyer bill. That should equal around another 10 mil for Fsnm and that should happen in days. That will not only increase the book value but should bring closer to tier 1.
Another thing to remember is that there are around 400 banks on the governments problems banks, only like 13% of them are predicted to fail and we have gone through a few more this weekend and also expect additional legislation to give the remaining regional banks sector a lift coming weeks. When the regional banks start lending they will be the sector to lead.
Many of the bigger banks have paid back some Tarp there is talk that the Regional banks who need to get capital might be able to access this, but shhhhh this is me forward thinking. I also don't necessarily think that Fsnm would even take this but it could be a lift to whole sector and induce short squeezes.
Once all the bad news is removed from the table look for the stock price to catch up with book value. Also as fsnm recovers and becomes profitable again q1 next year my guess if not bought out or merged by then we could really be in for a treat.
You have to understand Only 20 mil shares out there, they wont try to raise money here by diluting, they would do that at a much higher price if they decided too. Now at .60 the bank is only trading for 12 mil dollars yet they have 150 mil cash alone, so this represents a great value to value seekers as well, the share price is at a discount because the shorts are lumping all the regional banks together, so by picking the winners in the group is one way to win big.
all in my opinion hope it helps
So i got my tickets going to sit tight-
