Doral Shake-up Stirs Mixed Reaction

In the wake of a management shake-up at Doral Financial Corp., Zacks.com has assigned the mortgage lender a #5 (Strong Sell) rank, while Fitch Ratings has affirmed the company's ratings and maintained its status on Rating Watch Negative.Zacks, the online component of Zacks Investment Research, Chicago, said Doral "continues to incite pessimism among analysts" and noted the announced departure of its chief executive officer. In addition, Zacks said the consensus annual earnings forecast for the San Juan, Puerto Rico-based Doral has been reduced by seven cents over the past week, to $1.74 per share, compared with a forecast of $2.17 per share three months ago. Meanwhile, Fitch noted the connection between the announced "resignations and terminations" at Doral and the company's financial restatement process. "The most important factor in Fitch's decision to affirm the company's ratings at this time is the comfort that the named replacements for the three management positions have the ability and knowledge to lead Doral through the restatement process and beyond," the rating agency said. Zacks can be found online at http://www.zacks.com, and Fitch can be found at http://www.fitchratings.com.