Based on the aggregated intelligence of 165,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, financial products company Assured Guaranty (NYSE: AGO ) has received a distressing two-star ranking.
With that in mind, let's take a closer look at Assured Guaranty's business and see what CAPS investors are saying about the stock right now.
Assured Guaranty facts
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Headquarters (Founded)
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Hamilton, Bermuda (2003)
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Market Cap
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$2.9 billion
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Industry
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Property and casualty insurance
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Trailing-12-Month Revenue
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$1.3 billion
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Management
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CEO Dominic Frederico (since 2009)
CFO Robert Mills (since 2004)
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Return on Equity (Average, Past 3 Years)
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(0.6%)
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1-Year Return
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9%
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Competitors
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Ambac Financial (NYSE: ABK )
MBIA (NYSE: MBI )
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Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 39% of the 308 members who have rated Assured Guaranty believe the stock will underperform the S&P 500 going forward. These bears include cashsage and All-Star mrindependent, who is ranked in the top 1% of our community.
Earlier this year, cashsage wrote that Assured Guaranty "has a too high valuation compared to its sales potential." Our CAPS member adds: "It is also loss making."
In a more recent pitch from last month, mukwonago53149 also refused to give the company any credit. Here's an excerpt:
They're rated AAA by Moody's and Fitch. But that's a complete farce. The same agencies stamped their "AAA" approval on AIG, Lehman Brothers and dozens of other firms that plummeted to earth in 2008. Don't be fooled. ...
They were nearly wiped out by defaulting sub-prime mortgages. Since then, their share price has risen 505%. But soon, they'll be slammed by an even bigger wave of defaulting Muni Bonds. The perfect time to bet against them is NOW.
Like Warren Buffet says...
"[When] a few communities stiff their creditors and get away with it, the chance that others will follow in their footsteps will grow. What mayor or city council is going to choose pain to local citizens in the form of major tax increases over pain to a far away bond insurer?"
What do you think about Assured Guaranty, or any other stock for that matter? If you want to retire rich, you need to protect your portfolio from any undue risk. Staying away from dangerous stocks is crucial to securing your financial future, and on Motley Fool CAPS, thousands of investors are working every day to flag them. CAPS is 100% free, so get started!
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