I've already pointed out that the group at New Century Financial (NEWC) cashed out $103 million, even though the shares themselves seem to be going the way of all flesh. They were last seen changing hands over the counter for $1.69.
New Century, same old story.
What I hadn't realized is just how profitable the mortgage business can be -- when you get out at the right time.
Shares in the sector all took off in early 2003, just as the housing bubble was entering its final, euphoric phase. By a strange coincidence, that is exactly when insiders began shoveling the stock.Take the folks at Pasadena, Calif.-based IndyMac Bancorp (NDE), the country's second-largest stand-alone mortgage company. Last week, the company huffily said subprime loans made up less than 3% of its business, although it also admitted missed payments on its loan book were likely to rise this year. What isn't in doubt: Between early 2003 and last spring the stock climbed from just $20 all the way up to a peak to $50 and change. And that was great news for the people running the company, who were able to cash out a remarkable $76.6 million worth of stock when the going was good. The average price they got: $35.64. Today? Um.... $28.86.