Dennis Mitchell, CFA
HomeQ Corp.
HEQ-T
BUY
Nov 03, 2008
The only reverse mortgage market player in Canada. Have more than enough cash coming in to cover distributions. Very healthy dividend yield of about 16%.
Largest originator of reverse mortgages in Canada. Sold off significantly because of concerns about their ability to source capital. Major risk would be if a bank and initiates their own business, but he can't see this happening.
(A Top Pick June 12/08. Down 21.36%.) Management cut distributions because they thought it was the prudent. Converting to a scheduled 2 bank in Canada and will be able to diversify their funding source in terms of taking in deposits.