Triad Guaranty, Inc. (OTCMKTS:TGIC) Slashed in Half on Selling
The investors in Triad Guaranty, Inc. (OTCMKTS:TGIC) seem to have had enough of trying out a risky bet. With selling two days in a row, the defunct mortgage insurer lost 50% of its value, reaching $0.40. So far, no promoter has touched this unfortunate victim of the fallout of the real estate and mortgage bubble. 
With a weekend looming, it is time for reassessment for TGIC, and the new week may revive interest, especially if Friday draws the price low enough. For now, TGIC seems to rely on hopes of a buyout, an exit from dire financial straits for other mortgage insurers. Those companies took the weight of defaulting mortgages when the real estate market began to shrink after the 2008 boom.
TGIC left the scene with the following financial record:
- $820 million total assets
- $1.6 billion total liabilities
- $32 million total revenues
- $31 million net loss
But in the event of such a meltdown, the stock’s movement is quite removed from what happened to the fundamental business of the company.
Triad has existed since 1987, and signed its last mortgage insurance in 2008. At the end of 2012, the company started a process of rehabilitation with the Illinois Department of Insurance. The Rehabilitation plan should have been filed with the authorities in the first quarter of 2013. Since then, the insurer fired its management and continues to hope on a restructuring would work.
In discussions, investor sentiment is mostly negative, tending toward running away from this one-off opportunity. In any case, such services are rare among penny stocks, and it is best to stay away from a company containing so many unknowns unless you can afford losses of more than 30% in a day.
Still, the movements of TGIC are not too dissimilar from other penny stocks, and the connection to a risky industry suffering from the financial crisis is not a prediction for a total loss. TGIC may yet stage a form of recovery, supported by press releases that track the development of rehabilitation plans.
