Stock Alert for Washington Mutual Inc. (WAMUQ)*
  • Stock Alert for Washington Mutual Inc. (WAMUQ)
  • Stock Alert for Washington Mutual Inc. (WAMUQ)
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    Stock Alert for Washington Mutual Inc. (WAMUQ)

    Washington Mutual Inc. (OTC: WAMUQ)

    Washington Mutual Inc. is in bankruptcy. Investors should be cautious in buying common stock of companies in bankruptcy. It is extremely risky and is likely to lead to financial loss.

    Washington Mutual Inc. (WAMUQ) is a consumer and small business banking company with operations in United States markets. The Company is a savings and loan holding company. It owns two banking subsidiaries, Washington Mutual Bank (WMB) and Washington Mutual Bank fsb (WMBfsb), as well as numerous non-bank subsidiaries. The Company operates in four segments: the Retail Banking Group, which operates a retail bank network of 2,257 stores in California, Florida, Texas, New York, Washington, Illinois, Oregon, New Jersey, Georgia, Arizona, Colorado, Nevada, Utah, Idaho and Connecticut; the Card Services Group, which operates a nationwide credit card lending business; the Commercial Group, which conducts a multi-family and commercial real estate lending business in selected markets; and the Home Loans Group, which engages in nationwide single-family residential real estate lending, servicing and capital markets activities. In addition, the Corporate Support/Treasury and Other includes the community lending and investment operations, the Treasury function, the Corporate Support function and the Enterprise Risk Management function. In September 2008, JPMorgan Chase & Co. acquired all deposits, assets and certain liabilities of Washington Mutual banking operations from the Federal Deposit Insurance Corp. (FDIC). In September 2008, the Company filed for Chapter 11 bankruptcy.

    WAMUQ was founded in 1889 and is headquartered in Seattle, Washington.

    Share Statistics (04-June-10) FY

    2007

    FY

    2008

    %

    Chg

    Q4 2008 Q4 2009 %

    Chg

    Symbol WAMUQ Revenue, $Mn 17,230 n/a n/a n/a n/a n/a
    Current price $0.14 Gross marg. n/a n/a n/a n/a n/a n/a
    52wk Range: 0.07-0.70 Oper. margin 26.0% n/a n/a n/a n/a n/a
    Avg Vol (3m): 24,399,900 Net margin -0.4% n/a n/a n/a n/a n/a
    Market Cap. 232.81M
    Shares Outstanding 1.71B EPS, $ 1.22 n/a n/a n/a n/a n/a

    Source: Reuters.com, SEC Filings.

    Financial Summary

    Financial Strength (04-June-2010) Company Industry Sector S&P 500
    Quick Ratio (MRQ) 0.00 3.38 0.81
    Current Ratio (MRQ) 0.00 6.27 0.96
    LT Debt to Equity (MRQ) 117.27 72.21 90.56 133.71
    Total Debt to Equity (MRQ) 118.37 241.42 226.70 199.57
    Interest Coverage (TTM) 0.00 -2.90 41.36

    Source: Reuters.com, SEC Filings.

    Analyst Consensus

    No analyst recommendations are available for WAMUQ.

    Source: www.ft.com


    Investment Highlights

    WAMUQ recently announced that it has filed with the U.S. Bankruptcy Court for the District of Delaware an amended plan of reorganization and disclosure statement. As reported, the plan implements and incorporates the terms of a revised global settlement agreement reached among the Company, the Federal Deposit Insurance Corp. (FDIC) and JPMorgan Chase Bank N.A.

    “WMI has worked diligently over the last 20 months to maximize the value of the bankruptcy estate and is confident that the Amended Plan will accomplish the objective of providing substantial recoveries for WMI’s creditors,” the Company said in a statement.

    The FDIC seized WAMUQ’s flagship bank in 2008 and sold its assets to JPMorgan for $1.9 billion. The sale resulted in the two banking companies and the parties filing lawsuits against one another over roughly $4 billion in disputed deposit accounts.  A settlement agreement between the WAMUQ, the FDIC and JPMorgan will serve as the basis for the troubled company’s reorganization plan.

    The Company previously reported that the Bankruptcy Court held a hearing on June 3 to consider the approval of the disclosure statement, and it will ask the Bankruptcy Court to confirm its plan by July 20, following the said approval.

    As it was working its way to emerging from bankruptcy, WAMUQ’s move suffered a setback when bankruptcy judge Mary Walrath postponed the consideration of the outline of its reorganization plan and told the Company’s attorneys to talk further with shareholders about their requests for documents. As reported by Reuters, WAMUQ shareholders are seeking information underlying the proposed settlement, in which JPMorgan agreed to turn over the disputed deposits to the Company. The disclosure statement hearing was reportedly postponed to June 17.

    Source: www.reuters.com

    Technical Analysis

    Source: http://stockcharts.com

    Wednesday, WAMUQ closed above its 13 day moving average. This is generally considered to be an indication of a bullish trend.

    WAMUQ is trading within its Bollinger Bands. This is a normal condition and suggests that the stock is neither overbought nor oversold relative to the recent price action.

    WAMUQ’s MACD is currently indicating a weak bullish signal. Although the MACD is trending above the signal line, the indicator is still below 0, which suggests that the underlying moving averages are bearish.

    Comparative Analysis

    Company Name Ticker Price per Mrkt. Cap. P/E P/S
    June04-2010 symbol Share, $ $ Mn 2010 2011 2010 2011
    United Community Financial Corp UCFC 1.70 52.52 n/a n/a n/a n/a
    Wells Fargo & Co. WFC 27.78 144,740 14.32 9.68 1.69 1.64
    PNC Financial Services PNC 58.67 30,840 12.56 10.17 2.04 2.06
    Citigroup Inc. C 3.79 109,830 11.48 8.61 1.22 1.22
    GS Financial Corp. GSLA 12.95 16.82 n/a n/a n/a n/a
    Median 12.56 9.68 1.69 1.64
    Washington Mutual Inc. WAMUQ 0.14 232.81 n/a n/a n/a n/a

    Source: Thomson Financial

    Insider Trading Activity

    NET SHARES PURCHASE ACTIVITY

    Inside Purchases – Last 6 Months

    Shares Transaction
    Purchases n/a 0
    Sales n/a 0
    Net Shares Purchased (Sold) n/a 0
    Total Insider Shares Held 231.3M n/a
    % Net Shares Purchased (Sold) 0.0% n/a

    Net Institutional Purchases — Prior Qtr to Latest Qtr
    Shares
    Net Shares Purchased (Sold) (8,868,160)
    % Change in Institutional Shares Held 235.2%

    Source: Yahoo Finance

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