Countrywide Bull Calls It a 'Hold'

Few investment banking firms have been as bullish on Countrywide's stock as Sandler O'Neill. But those days are over.After reviewing Countrywide's third-quarter earnings statements, Sandler O'Neill analyst Mike McMahon reduced his rating on the stock to "hold" from "buy." Among his concerns, Mr. McMahon cited a larger-than-expected servicing impairment charge booked by the company. Even though Countrywide earned $582 million, it represented a 45% decline in earnings. It also revealed a $796 million servicing impairment charge that was offset, in part, by a $591 million hedging gain. Late Wednesday, Smith Barney slapped Countrywide with a "sell" rating. Countrywide's shares sold off in trading Wednesday, falling 11.5% on the day to $33. Its 52-week high is $39.93, its low, $23.00.