SwingTrade Member Forum

[jaybird249]

Bullish on FCSX: $3 short term target

- Core operating earnings before charges of $2 / share.

-Takeover Target: Barclays recently made a sizeable investment in FCSX. Barclays is focused on increasing US presence- they bought Lehman broker operations.

-100% price drop is an ENORMOUS overreaction. The $60 - $80 MM loss provision ( $35 MM after tax) does NOT include ANY recoveries from another dealer in these transactions or the customer. FCSX IS PURSUING these parties to recover these losses.


In CC, FCSX stated liquidity starting to return to markets. This is making it easier to liquidate the account.

-Exposure to bad account already substantially reduced.. 50% less than in November and will be almost all off the books by September.

-FCSX has ample regulatory capital: More AS IT DID IN EARLY 2008 AFTER THE IPO.

- In the HIGHLY unlikely event that FCSX suffered additional losses beyond its capital cushion, worst case is FCSX would run off operations. My conservative estimate of FCSX runoff value: $5 / share.

-Forced liquidation selling is nearly over and I expect FCSX to recover VERY quickly to $2.50 near term and $ 3 - $4 by April.