Value Microcaps Motherboard

[tmcal6]

Delta Financial Corporation (DFC) is in the same market as TMFZ.ob, sup-prime mortgages, however it is 3.5 times the size and three years ahead of TMFZ in their business plan. DFC has not had a profit yet this year (actually lost about $.50/share in the first 9 months) because it changed from gain-on sale accounting to portfolio accounting. Under gain on sale, they would probably be reporting earnings of approx. $.50 per share for the 4th quarter, but under portfolio accounting they are expected to break even or have a penny profit. Earnings going forward will likely increase approx. $.10 per quarter which will present great comparisons quarter by quarter going forward. The company will probably announce their next securitization in the next 6 weeks which could be anywhere from $750 to $800 million. I own a relatively large position matching my positions in TGA and MDF.