By Luis Garcia Pelatti El Vocero Wednesday April 14, 2010 01:53
Joe Gladue, an analyst at B. Riley & Co., described as "encouraging" preliminary financial results presented by Popular, Inc. The company reported a preliminary net loss of $ 85 million in the first quarter of this year, results that are better than she expected the analyst, anticipating a net loss of $ 236 million. The recommendation for improved Popular titles from "Neutral" to "Buy."
According Gladue, the results were better than expected due to provisions for loan losses were lower than expected. "Preliminary results of the first quarter of 2010 are very encouraging," Gladue said in a report released yesterday.
People reported that initial public offering of shares with the goal of raising $ 900 million in capital. People could use these funds to strengthen its capital and participate in a transaction assisted by the Federal Deposit Insurance Corporation (FDIC).
With this issue we believe that People has sufficient capital to participate in the auction of any transaction assisted in Puerto Rico, "said Gladue, who believes that an assisted transaction will be beneficial to future earnings of Popular and its capital position, and that it can normalize their profits sooner than anticipated, in early 2012.
It is possible that People decide to sell one of its subsidiaries, EVERTEC, to obtain additional funds. According Gladue, interest in selling may have increased the possibility of obtaining a sale price of approximately $ 1,000 million, a figure that is above about $ 440 million and $ 907 million it had estimated the analyst.
Michael Diana, an analyst at Cantor Fitzgerald believes EVERTEC People choose to sell only if it gets involved in a transaction assisted.
With these transactions, People would be seeking to increase its capital base, with the imminent intervention of the FDIC and the Office of the Commissioner of Financial Institutions with the three banks www.brileyco.com/news_view.phpwith Cease and Desist Orders.
Shares of Popular, Inc. (NASDQ: BPOP), they increased to 27% over yesterday, and finally closed at $ 3.50, 14.75% above the previous day. Its highest level in the last 52 weeks was $ 3.86 and the lowest $ 1.00.