Lite, you asked “fair market value.”
The below calculation is based on Barron’s win with the little tucker act in local federal district court. Either way, if the Treasury walks away with 79.9% of the common stock and a possible cram down with more diluted shares, it does not change the intrinsic value of the earnings power of the business. The question, how much value will each equity holder receive?
Freddie Mac
JPS are due $14.1 billion (par value) and the common shares own the company.
Common Shareholders $214.08 per share Intrinsic Value.
Freddie Mac
June 30, 2023
Freddie Mac Reports Net Income of $2.9 Billion for Second Quarter 2023
Earnings Power of the Business
A multiple of 12 is not unreasonable
EARNINGS POWER OF THE BUSINESS
Freddie Mac common stock outstanding 650,059,553
$2.9 billion net income for the second quarter of 2023.
Freddie Mac net earnings $2.9 billion per quarter, a projection of $11.6 billion net per year.
$11.6 billion net / 650,059,553 = $17.84 per share of earnings
Price to Earnings Ratio of 12 x $17.84 = $214.08 per share Intrinsic Value
Fannie Mae
JPS are due $19.1 billion (par value) and the common shares own the company.
Common Shareholders $207.24 per share Intrinsic Value.
Fannie Mae
June 30, 2023
Fannie Mae Reports Net Income of $5.0 Billion for Second Quarter 2023
Earnings Power of the Business
A multiple of 12 is not unreasonable
EARNINGS POWER OF THE BUSINESS
Fannie Mae’s common stock outstanding 1,158,087,567
$5.0 billion net income for the second quarter of 2023.
Fannie Mae’s net earnings $5.0 billion per quarter, a projection of $20 billion net per year.
$20 billion net / 1,158,087,567 = $17.27 per share of earnings
Price to Earnings Ratio of 12 x $17.27 = $207.24 per share Intrinsic Value
Barron Quote:
“I posit that the variable liquidation preference outlined in the SPSPA and all amendments are an illegal commitment fee/charge attached to the purchase of the senior preferred shares. Prohibited by the Charter Act. The warrants are also a fee in consideration for access to the commitment. Prohibited by the Charter Act.
I posit that the senior preferred shares with their variable liquidation preference as outlined in the SPSPA constitute a new product for the purpose of the secondary mortgage market outlined in the charter act at sec 1719.
I posit that under the safety and soundness act as modified by HERA, the sale of SPS with a variable liquidation preference to Treasury under authority of sec 1719(g) of the Charter Act required notice in the federal register, opportunity for public comment, and official rule making by the plain language of the safety and soundness act.
I posit that the above statutory violations necessarily violate the warranties on behalf of the FHFA-C contained in the SPSPA.
301 Billion to be returned to the corporation. LP and warrants canceled. Future of 191 billion of taxpayer debt illegally given to corps to be determined.” End of Quote
AI
