Finally looked into the 10Q a bit given how much the stock has sold off. Is it right that the company has less than $1 billion of tangible net worth if you exclude all the good will & intangibles? All this against a $17 billion credit card portfolio?
A substantial portion of the credit card portfolio is held by non-recourse securitization entities.
The notion that these are "non-recourse" is a joke. the day a securitization trust fails is the day ADS fails. they will have zero fundraising ability. That said, think Frank87 is looking at it correctly. The finco has substantial assets and adequate capital.
Best guess on recent pressure - shows there are a lot of investors looking to sell and i suspect a good portion of the 7M shares they didnt accept are in the process of being liquidated.
At sub-$140, i think its starting to get more interesting. Still not convinced that they deserve a multiple higher than SYF but downside seems more protected now. I dont really believe they are meaningfully better at marketing and think their faster growth is offset by SYF's scale and better mouse trap (profit-share vs royalty), and more diversified products - dual card, non-card businesses). need to think through what their real growth and recession credit looks like - their portfolio / growth will be meaningfully different making comparisons to 2008 almost meaningless imo.
