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Sold this last Nov but licking my chops again. But when I think, bank vs MIC? Slightly smaller dividend yield, but better earnings growth. I would rather have bank stock. But I don't need to add anymore bank stock, so I window shop.
 

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Humble you don't like me huh... I sent that quick from my phone today

MIC and HCG have had huge growth in their dividends in the last few years.... if they BUILD on that streak for another 20 years(or even 5-10 years), your dollar investment now, will be significantly larger than the big banks.

More risk for more rewards...

Canadian's real estate is different than the USA. We can not put our keys in the mailbox and walk away with no penalty.
Yes its overpriced, but it doesn't mean it can't get more overpriced, just like the stock market in the past year.

GoldStone, that BNN guy said he owned a small piece of Genworth...

Everyone knows it has some risk behind it... No one is trying to hide that... I don't think the housing market will explode... We'll see what happens over the next year

Like any stock you decide if you want it or not... I think this one is definitely worth looking into




They are a member of CDZ.to
Here's their 5+ year streak almost doubled the yield, along with 2 special dividends
http://investor.genworthmicanada.ca/English/share-information/Dividend-History/default.aspx




If you think the housing market might collapse, stay clear out this name. If you have enough invested into real estate with your house, you don't need to add more exposure.
There are good reason to be fearful of this stock.... I like what they have done in the past, and will play it out for now.

It's a $30 stock right now, I'm guessing it will be a $35 stock in a year from now, and everyone will still be in their houses. Only time will tell though :)
$35 stock in <2 months ;)
My largest position at the moment.
 

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$35 stock in <2 months ;)
My largest position at the moment.
Yeah pretty good and quick rebound... should be stale but positive for awhile now :)

Although, I read Jason Donville's recent RoE report, and he said he is hanging onto a lot of cash....

suggests a collapse might not happen, but 2% of growth annually until one does

the valuations are so high

Right now I really like GIBa ... Jason Donville is on BNN this week, he'll shed some light



Another cool graph...website is

http://www.researchaffiliates.com/AssetAllocation/Pages/Equities.aspx

You can see the expected returns are very low
Russia has the biggest volatility so be careful!
 

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Anyone has any opinions where this stock might go in the future. Looks great as a value buy, but the current overvalued market and the new restrictions seems to be bad news for this company.

I wonder if it's going to be a great pick if it goes again down to 22-23$
 

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Anyone has any opinions where this stock might go in the future. Looks great as a value buy, but the current overvalued market and the new restrictions seems to be bad news for this company.

I wonder if it's going to be a great pick if it goes again down to 22-23$
Great value, nice yield. If/when interest rates ever go up it should be a positive for insurance companies in general.
 

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So this is down 20% in the past couple of months. Is this the first leg down or a buying opportunity? I don't really have a sense of what proportion of their portfolio of insured mortgages would be considered 'safe' after the crazy run up of recent years and what might be considered more risky if more recently issued and property values come back down to more reasonable levels. They keep raising the dividend and CMHC is an uninterested competitor but real estate sentiment seems to have turned the corner, so it's hard to know if there's still a lot of room below. If real estate drops 10%, is MIC going busto or is that no big deal given that would only takes prices back to where they were last fall?
 

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It is widely believed that Genworth is in trouble, related to the Home Capital Group troubles. The thinking is, where there's smoke, there's fire.

I learned some years ago that full information does not come out just through financial statements and earnings releases. As a novice in the field, I can't analyze their full situation myself and figure the extent of their risk or exposures. Besides, when companies get into trouble, financial statements can get revised. These are my memories of the 2007-2008 US mortgage crisis.
 

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Genworth is far different than Home Capital. It's a big mistake to brush them the same way. Genworth return YTD is about -4%. Home Capital is -70%. There is no regulatory issues, no capital issues, and no performance issues at Genworth. There are no deposits to evaporate, they are not a bank. Genworth is almost a utility. They have regulated rates which give them extremely steady revenue and profits. And even if they didn't write a single piece of insurance again, they have a book of $40 a share of very high quality fixed income assets backing up the stock. I've owned the shares a few times, always on pullback and have done very well, although not holding now. Would consider jumping in again, especially below $30. Genworth used to trade at a premium to book value but now trades at a 20% discount with no underlying performance issues.
 

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Genworth is far different than Home Capital. It's a big mistake to brush them the same way. Genworth return YTD is about -4%. Home Capital is -70%. There is no regulatory issues, no capital issues, and no performance issues at Genworth. There are no deposits to evaporate, they are not a bank. Genworth is almost a utility. They have regulated rates which give them extremely steady revenue and profits. And even if they didn't write a single piece of insurance again, they have a book of $40 a share of very high quality fixed income assets backing up the stock. I've owned the shares a few times, always on pullback and have done very well, although not holding now. Would consider jumping in again, especially below $30. Genworth used to trade at a premium to book value but now trades at a 20% discount with no underlying performance issues.
But as Canadian housing prices turn down, won't Genworth Canada (important that you distinguish between GNW and MIC, two completely different companies) have to pay out a lot of 'insurance' claims on the subprime mortgage insurance they've written?
 

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How much will they really have to pay in insurance claims, though? With the appreciation seen in the last few years, particularly in the last few months, I would think that prices would have to fall quite a bit before sale of the asset would no longer cover loan principal for most of these mortgages.
 

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Prices would have to fall substantially to have any impact. And they're not a subprime insurer. Just because you have a 5-20% down payment and require default insurance from MIC, does not make you a subprime borrower. Their customer credit profiles are disclosed and are very high quality.
 

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How much will they really have to pay in insurance claims, though? With the appreciation seen in the last few years, particularly in the last few months
There's been no appreciation in the past few years. They're likely to have to pay out substantial insurance claims. If you've been following the HCG debacle, its clear that there has been dramatic deterioration in the GTA RE market far beyond what the Realtors want people to believe. HCG claims a 67% LTV on their portfolio, but the market is treating HCG as though portfolio LTV is in excess of 100%. The implication for Genworth MIC is that their portfolio is likely in far worse shape than officially stated.

, I would think that prices would have to fall quite a bit before sale of the asset would no longer cover loan principal for most of these mortgages.
In a foreclosure situation, there are very substantial costs of the foreclosure and actual inventorying and rehabilitation of properties before they're marketable. In the USA, these costs were typically $60-$80k per unit. And of course, units weren't turned over to the lenders with positive equity, so there was a deficiency right out of the gate. Canadians are perhaps more polite to their lenders (ie: less trailer trash here, anecdotally), but there are substantial carrying costs associated with keeping furnaces running that don't exist to the same extent as "down south".
 

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No appreciation in the past few *years*? This is one of the most bizarre statements I've seen on here. I'm bearish on residential real estate going forward, but take whatever measure you like of Canadian residential real estate, Teranet or any other, and the appreciation is evident. I don't think it's sustainable, but to claim that the price gains haven't happened is a very difficult argument to support.

HCG has other well documented issues affecting their share price. Nothing to do with their book, everything to do with an unusually timed regulatory decision leading to loss of investor confidence, leading to a frankly idiotic loan agreement. Even if they had solid mortgages, they've given away their future profits to HOOPP, so no one wants to invest. I don't see any correlation here with Genworth's insurance business.
 

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No appreciation in the past few *years*? This is one of the most bizarre statements I've seen on here. I'm bearish on residential real estate going forward, but take whatever measure you like of Canadian residential real estate, Teranet or any other, and the appreciation is evident. I don't think it's sustainable, but to claim that the price gains haven't happened is a very difficult argument to support.

HCG has other well documented issues affecting their share price. Nothing to do with their book, everything to do with an unusually timed regulatory decision leading to loss of investor confidence, leading to a frankly idiotic loan agreement. Even if they had solid mortgages, they've given away their future profits to HOOPP, so no one wants to invest. I don't see any correlation here with Genworth's insurance business.
Just ignore him. He posts on other blogs too claiming prices of individual units haven't gone up since 2013. As someone who's been eyeing the market for years looking to get in, it's complete nonsense and can easily be refuted with 5 minutes of research.
 

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MIC looks like good long term value here, but both the chart and sentiment are weak. I wouldn't be surprised to see further downside.
 

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Article in the FP yesterday trying to defend HCG referencing MIC having good loss experience on HCG loans. Can't see any linkage of MIC to HCG mortgages being good for MIC sentiment, regardless of exposure levels. I am looking to get a 1/2 position prior to the TREB May release at $29.xx and maybe 1/2 at $26.xx after, if there is bad reaction. Hopefully that should be sufficient margin of safety.
 

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No appreciation in the past few *years*? This is one of the most bizarre statements I've seen on here. I'm bearish on residential real estate going forward, but take whatever measure you like of Canadian residential real estate, Teranet or any other, and the appreciation is evident. I don't think it's sustainable, but to claim that the price gains haven't happened is a very difficult argument to support.
No, there has been no appreciation. The sales mix has shifted, but individual identical houses have not changed price in the past few years since the 2013 apex. The peak was marked by Flaherty's changes to subprime mortgage insurance in Canada. Places like Calgary peaked even earlier (2011 for Calgary).

HCG has other well documented issues affecting their share price. Nothing to do with their book,
Everything to do with their book. Otherwise they would not be in this trouble. HCG could only get financing on the basis of market perception being that their portfolio was in excess of 100% LTV.


agreement. Even if they had solid mortgages, they've given away their future profits to HOOPP, so no one wants to invest. I don't see any correlation here with Genworth's insurance business.
The 'correlation' is that RE prices have been stagnating (and are now falling) since 2013, hence, there is systemic overstatement of LTVs at most Canadian lenders if they are using the Realtor transactional averages, rather than more realistic assessments of the market.

Teranet, lol, Teranet's methology means that they can lag literally years behind reality. Not a reliable or credible measure for real-time price changes, that's for sure.

Lots of unemployed/underemployed RE industry participants on the Internet these days trying to cast a completely false narrative of appreciation in the post-peak era. Don't underestimate the lengths to which the RE sell side propaganda machine will go to cast a false narrative.
 

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No, there has been no appreciation. The sales mix has shifted, but individual identical houses have not changed price in the past few years since the 2013 apex. The peak was marked by Flaherty's changes to subprime mortgage insurance in Canada. Places like Calgary peaked even earlier (2011 for Calgary).



Everything to do with their book. Otherwise they would not be in this trouble. HCG could only get financing on the basis of market perception being that their portfolio was in excess of 100% LTV.




The 'correlation' is that RE prices have been stagnating (and are now falling) since 2013, hence, there is systemic overstatement of LTVs at most Canadian lenders if they are using the Realtor transactional averages, rather than more realistic assessments of the market.

Teranet, lol, Teranet's methology means that they can lag literally years behind reality. Not a reliable or credible measure for real-time price changes, that's for sure.

Lots of unemployed/underemployed RE industry participants on the Internet these days trying to cast a completely false narrative of appreciation in the post-peak era. Don't underestimate the lengths to which the RE sell side propaganda machine will go to cast a false narrative.
What complete and utter nonsense. There are 40 year old condos in Vancouver selling for close to $1,000/ft2. This was certainly not the case 4 years ago. Assessments have gone up big time, and the majority of units are selling over assessment. Don't talk about reality when you're living in a alternate one.
 
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