FBR Slashes IndyMac Price Target to 0

In light of the announcement from IndyMac Bancorp, Friedman Billings Ramsey has slashed its price target for the company's common stock from $1 to zero. "We are not predicting IndyMac Bancorp's failure, but we expect that the value of the common equity left after today's announced actions [see above item] will be immaterial," said the report written by Paul Miller, Bob Ramsey, and Annett Franke. The report called the decision to leave the forward mortgage business, given the company's business model until now, as "very significant." FBR said there isn't any value in the company left for common stockholders with continued home price declines, management's higher loss estimates, recent rating downgrades of the company's mortgage-backed securities portfolio, and the decision to stop new forward mortgage originations.