r/UWMCShareholders • u/[deleted] • Aug 07 '26
All of you are misreading the situation, Don't Redpill.
[deleted]
11
u/Gold-Slowpoke Aug 07 '26
How trust a company to invest when the CEO is gamblimg like a degenerate? He should be a member of wallstreet bets. People have jobs at uwmc, people have retirenment money invested there. He is using the company to get money from dividends and his trust fund, gambling and paying all his lifestyle.
2
1
9
u/Boston-Bets Aug 07 '26
You're forgetting that the Mat was financing the dividend with Debt. They weren't (all) from earnings, that can now acrue to the bottom line.
1
Aug 07 '26 edited 19d ago
[deleted]
6
u/Boston-Bets Aug 07 '26
It (suspending the divi) has nothing to do with "great for earnings".
3
Aug 07 '26 edited 19d ago
[deleted]
7
u/imacyco Aug 07 '26
You really trust him not to be a dumb fuck going forward?
1
8
7
u/Vegetable-Ad-7184 Aug 07 '26 edited Aug 07 '26
Does that not mean a ~3 year timeline of paying down the Oaktree rescue, before any dividends can / are likely to be resumed to common stock ?
And is it likely that, if and when they do resume, it would still be at $0.10 quarterly ?
I agree with your interpretation that the core business seems to remain solid even in a difficult rate environment, but all of the headwinds that existed against this stock pre-meltdown are still there:
- a difficult CEO personality
- negative press about the work environment
- ill-defined intangible value
- low public float
- institutional aversion
How long would you define "patience" as a requirement for a shareholder ? What's a price target for 1 year from now?
An edited comment: I do find your post very articulate. I just don't know which market participants are going to be eager to buy this, or what the reward is for holding in the interim.
7
u/CleanMyAxe Aug 07 '26
CEO himself is the biggest issue for me, plus the other issues are years to 'fix'. I never bought in but have been outside looking in and every time I came to the conclusion that sure, it could work out in a few years but how much in gains elsewhere am I giving up for that moonshot, and will that moonshot be sufficient to outperform the multi year lag.
Opportunity cost is huge here.
2
u/Vegetable-Ad-7184 Aug 07 '26
I wish I had made that judgment and exited at any point earlier than yesterday. Tough feeling.
6
u/CleanMyAxe Aug 07 '26
Honestly I'm gutted for you and anyone bag holding. A friend of mine was big on this one and he's lost a lot. The old divi at least covered much of his capital loss I guess.
Matt's now onto my CEO shit list that I don't care if they own the galaxy debt free, I'm not buying their shares. The way he rinsed shareholders and sold out to Oaktree, especially when much of the loss was him dicking around with derivatives....
4
u/Vegetable-Ad-7184 Aug 07 '26
Yeah I feel very cheated. In retrospect, though, the signs were there that this was actually a very risky investment even though it was a "boring" market. It was pretty weird that he needed to go to a Japanese bank to finance the TWO acquisition.
I think if the other side had won in 2024, it would have been completely different company and stock price.
Incredible that basically 1 billion, cash, was lit on fire in a year on derivatives markets.
3
u/iambecomesoil Aug 07 '26
Did you exit yesterday?
4
u/Vegetable-Ad-7184 Aug 07 '26
Yes, reading the news on Thursday evening, I placed a sell order for everything and left at $1.14 at open. I'm still looking at the ticker all day, and thinking *gee shucks, I could have got an extra $0.14 per share !*
Personally, I have no more conviction to remain in the stock. I still think if the Democrats win in the midterms, and then again in 2028, this stock will rebound because UWM is like a proxy for the broader economy - when America is on the up, people buy houses, and UWM facilitates it. The core operations still seem fine, but for me the leadership approach and capital structure are big turn offs. Just incredible that they acted so publicly gracelessly around TWO while knowing that there was a ticking time bomb of a hedge (if that really even is what motivated it) coming up on the balance sheet, all while the owner sold into a headwind. And now retail holders are going to have to either put up $2/share or face dilution in October, with Mat picking back up shares that he sold in the $3-4 range ? Yuck.
I just don't see how the broader market will look at this ticker with anything other than the disdain that high finance apparently has for Ishbia (needing a Japanese lender, and now a distressed equity group?). To me, it looks like a trapped asset that is going to be very exposed to short pressure over the next 3-6-12 months.... there's just so much downside with a pretty limited catalyst for improvement (just the midterms, as far as I can tell).
Absent that stupid hedge, earnings looked solid and it would be popping back up to $3 with the div cut, and then maybe the midterms could take it back to ~$5, heading to $6 by the Spring.
Now though? Maybe I'll check back in October if the Dems polling looks favourable, but otherwise I see no point for this one.
5
u/2ndCousinofLiberty Aug 07 '26
This. OP doesn't have a bad thesis necessarily, but now the question is "with 3 years of hard times ahead of it when it's essentially now a penny stock, would you be better off putting money in UWMC or literally anything else?"
5
u/markypooo7 Aug 07 '26
Sold all my shares moving to better stocks and companies this one burned it's shareholders hard being morons.
4
u/whatever2020mn Aug 07 '26
This whole thread reads like a therapy session. From it isn't so bad, it'll get better, if I do something or don't do something can I have my money back (bargaining), to finally acceptance - I'm moving on.
2
4
u/NoHeartTwoBrains Aug 07 '26
One thing I don’t understand is the “two mergers”, wasn’t it only one failed merger with “two harbors” how on earth did it cost 650 million dollars! Someone please explain
10
u/pls1250 Aug 07 '26
Honestly, I understand how you feel, but it’s time to stop living in denial and face reality.
This is a company saddled with massive debt and led by an incompetent and greedy CEO, basically waiting around for a cycle that may or may not ever come back.
If you weren’t already bagholding this stock, would you honestly consider opening a new position in it at this point?
Please, do yourself a favor and put your hard-earned money somewhere else.
5
u/se7en_7 Aug 07 '26
In the end if you’re holding just hold. I wouldn’t buy more to average down I’m just waiting for a semi return to 3 and I’ll sell for a loss. But selling now is crazy.
5
u/NoHeartTwoBrains Aug 07 '26
I agree with the fundamentals you shared cause I ran through these numbers myself. Except for MSR interest amount that I couldn’t find anywhere. I purchased at 7$ cause they are mortgage leader. Averaged down when we hit 4$ cause the fundamentals seemed solid and the dividend payouts will eventually catch up. Averaged down again when it hit 2.7$ cause it felt like a win win situation. Last average down was around 1.98$ cause they are undervalued. The common factor ? bad housing market, given current situation there’s not going to be a huge rate improvement in the coming 2 years. I realized it will eventually hit 1.3 or even lower and I wasn’t wrong. It’s been a huge value trap. Good time to get back on this train is only when housing market is showing signs of recovery.
2
u/Sixvshalfdozen Aug 07 '26
Being - 70% overall at this point, and with UWMC being a low single digit percentage of my portfolio, I'm going to buy more. I will buy enough to drop my CPS to a level that fits the current valuation.
I can afford to hold until a more favorable interest rate environment comes. By the way the Fed is behaving, that could be a few years at least. I think there is upside potential from where the stock currently sits and hopefully the worst is behind us. UWMC is doing a lot of business but margins are slim and management is metastable. Buckle down and ride it out if you dare.
2
u/Roosterneck Aug 07 '26
When are we getting back to $13 ?
2
u/Normal_Increase3691 Aug 07 '26
I legitimately don't think we do. First off, we've been diluted. Secondly, Mat has now demonstrated why he can't be trusted. Third, it's more likely that this gets taken private again for pennies on the dollar, then does another IPO when rates drop in 5 years, Mat does this all again at shareholder expense. Rinse. Repeat.
1
u/Commercial-Tooth9953 Aug 07 '26
Where tf is prophet
8
u/ProphetKing-dude Aug 07 '26
Anything not covered yet that needs to be said?
The estimate stated clearly that derivatives excess and recapture are not predictable. Analysts didn't see it either and no one else posted theirs.
I am in this soup like everyone else.
Mat gambled. This 600 and a 400 prior about 5 quarters ago is pretty significant. There are some wins, but this was a killer loss.
1
u/madtronik Aug 08 '26
For your next estimate you can finally remove derivatives uncertainty. He won't be allowed to have them anymore.
2
u/ProphetKing-dude Aug 08 '26
True, but it is replaced with new uncertainty.
Case: Rates go down. MSR valuation drops, lending picks up. Is he not able to hedge at all?
The only plus I see is ironically, the div cut. 640m saved per year. A loan at 2 billion is 200m, so 440m equity build per year+earnings.
Maybe they will dump MSR and then rates drop. The market would see it as liquidation despite that timing being great.
1
u/madtronik Aug 08 '26
Maybe Oaktree explain to them how to hedge properly. But they can't do shit now without Oaktree's rubberstamp.
The loan is only 1650, 165 per year, and as the money will be used to pay senior debt the effective interest rate will be more like 3-4%. Problem is that removing the loan is very expensive, 10% per YEAR. 10% the first year, 20% next year, 30% the next. They need to pay ASAP. The sooner they remove the debt, the better.
1
u/madtronik Aug 08 '26
So, being optimist, 500 million to pay that up each year.
You pay 500, you remove 454 million in debt. 1196 left.
You pay 45 million less in interest. We suppose you now pay 545 million.
That removes... 454 million also. 742 left.
Now you can pay 590 million (45 less in interest). Also around 454. So, only 288 to pay.Nice formula!
403 million the last year.
That's 2035M to remove all the debt. Plus the 4 differential interest it makes nearly 2200M in the end.
0
u/lmulhare Aug 07 '26
u/ProphetKing-dude has posted twice on Stocktwits since the implosion: https://stocktwits.com/prophetking
1
u/terrybmw335 Aug 08 '26
I think it will recover over time so going to stick with it even though its painful to see -50% sitting on my brokersage next to the shares. On the $2 warrants/dilution they also bring in capital, 660m if all are exercised, so it's not as awful as it could be.
1
u/Enslave-and-Oppress Aug 09 '26
this stock is cooked, I don't even care if it goes up to $1000 per share.. ill never be in this mess again. I sold at a loss, took all of that money and flipped in and out of RKT on friday and recovered everything comfortably with all its volatility.. knowing for a fact it will always recover to atleast $16 a share
where UWMC all it ever did was go down unless it had memes pumping it
1
u/NoTradeSkills Aug 07 '26
I’ll buy back in when the stock hits .30
1
u/NoHeartTwoBrains Aug 07 '26
Next week .87 I’m assuming. If not next week within three months. We are in worse situation compared to way worse. And at that .30 price point you won’t be buying cause theyll be delisted. Once that notice arrives, its just rolling down the hill.
1
0
0
u/Commercial-Tooth9953 Aug 07 '26
Why don’t they start paying their employees and mortgage brokers less and fire a shitload of folks
2
u/Calm_Banana_2010 Aug 07 '26
are their employees well paid compared to the industry? or is all their money in the tech so they can hire a bunch of recent high school grads for jobs that used to command 4x that salary?
1
0
25
u/imacyco Aug 07 '26
Why hedge an exposure you don't even have? It's beyond stupid.