One might have thought the worst was behind bank stock New York Community Bancorp (New York Stock Exchange: New York CB). Unfortunately, some people may be wrong. New York Community shares fell another 42% in afternoon trading on Wednesday, even as trading was suspended following new reports suggesting the bank was desperately searching for cash.
Apparently, New York Community is on the prowl for outside investors who can inject some cash into New York Community’s stagnant revenues, according to reports. This is probably the last thing you want to hear from a bank, especially if you have savings with such a bank. However, reports suggest that one reason New York communities are currently struggling with cash flow is that they currently have large amounts of cash sitting in accounts that are subject to credit losses. It didn’t help that Moody’s declared New York Community’s credit rating full junk status, making it even more difficult to find additional funding sources.
last moment reprieve
The good news is that the company managed to find a last-minute source of funding, raising a whole $1 billion in capital from various venture capital firms. One of them is none other than former Treasury Secretary and “Suicide Squad” producer Steve Mnuchin, whose Liberty Strategic Capital will receive a stake in exchange for stock, and Mnuchin himself will receive a board seat. did.
What is the fair value of NYCB?
Turning to Wall Street, analysts have a consensus rating of Hold on NYCB stock, based on 13 Holds and 1 Sell assignments over the past three months, as shown in the chart below. going. NYCB’s average price target of $5.71 per share means it has 36.6% upside potential, after the stock has declined 76.4% over the past year.
disclosure
