Investment banker Sandler O'Neill, a long-time bull on Fannie Mae, has reduced its earnings estimates on the mortgage giant, citing the company's troubles with its $8 billion manufactured housing portfolio.Sandler O'Neill analyst Mike McMahon reduced his 2004 earnings estimate by $0.17 a share to $7.83. Mr. McMahon notes in an analyst report that Fannie will take an after-tax hit of between $156 million and $169 million on the MH portfolio. Sandler, though, is maintaining a "buy" rating on the company. "The primary risk to our target price continues to be headline/political risk," it says.

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