Assured Guaranty Shares Plunged: What You Need to Know (ABKFQ.PK, AGO, MBI)

Assured Guaranty Shares Plunged: What You Need to Know

Watch stocks you care about

The single, easiest way to keep track of all the stocks that matter...

Your own personalized stock watchlist!

It's a 100% FREE Motley Fool service...

Click Here Now

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Assured Guaranty (NYSE: AGO ) shared were down 10% Monday after the company lost its AAA rating.

So what: S&P downgraded Assured Guaranty from AAA to AA on higher potential losses because of mortgage-backed securities. Later in the day, the company announced it would beat analysts' estimates of earnings in the quarter.

Now what: This is a double-edged sword for investors as the higher guidance is great in the short-term but a lower rating hurts the company's prospects going forward. Ambac Financial (NYSE: ABK ) and MBIA (NYSE: MBI ) have been hurt by ratings downgrades, and Assured Guaranty was one of the last standing AAA-rated insurers. The market didn't seem to be too excited about the guidance news later in the day, so I think this will be a long-term worry for shareholders going forward.

Interested in more info on Assured Guaranty? Add it to your watchlist by clicking here.

The Steve Jobs Betrayal
You may already know that in the final year of his life, Jobs revealed a stunning betrayal — and told his biographer, "I will spend my last dying breath... and every penny of Apple's $40 billion in the bank to right this wrong." What was it that made Jobs so irate — and why could it make a few in-the-know investors some major profits over the coming months and years?

Enter your email address below to find out what made Jobs so enraged!

Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings, or follow his CAPS picks at TMFFlushDraw.

Try any of our Foolish newsletter services free for 30 days. True to its name, The Motley Fool is made up of a motley assortment of writers and analysts, each with a unique perspective; sometimes we agree, sometimes we disagree, but we all believe in the power of learning from each other through our Foolish community. The Motley Fool has a disclosure policy.

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment icon found on every comment.