There may be some unhappy MA campers who think MB.com brokers water down MA’s “elite” status in the industry. (“Elite” is a term that MA founders have used to market the firm because MA was built specifically to cater to high volume mortgage professionals). MA brokers, on average, are more established and generate significantly more volume than MB.com brokers.
We suspect that any discontent will blow over, however, and that Pacific Mortgage Group point man Ron Swift will start delivering in 2012. He didn’t put his impeccable reputation and career on the line to join MA for no reason. There’s got to be something good cooking.
A merger should save the parent company a decent chunk of change. There’s certainly some redundant personnel and operations costs, in addition to the added expense of marketing two organizations.
We have to wonder what will happen to MB.com’s stock (symbol: MBKRD), if and when MortgageBrokers.com disappears. The company reverse split 1-for-30 on Nov. 14. That dropped its shares outstanding to 1.29 million, with a market value of just $323,000 (25 cents a share). Will Pacific Mortgage Group roll itself into the stock? We have no idea, and management is mum about it. It sure would be nice if they did, assuming Pacific’s lender (Radius Financial) gets its bank status and ramps up volume and profitability. It’s going to take a lot of execution by management though, and we can only hope they won’t dilute existing shareholders, as has been done in the past.
Disclosure: CMT editors are agents of Mortgage Architects and own stock in MB.com. (Definitely, not our best stock pick of all time—so far anyway.)
Rob McLister, CMT
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