Is it safe to invest in Indymac?

Question

I would like to invest $100 in Indymac, which is at around $0.10 a share, which can buy me about 1,000 shares. I don't feel I have anything to lose by investing $100 and I could possible invest more if the stock price increases.

Yahoo Finanace projects the 1yr targest est to be over $4.00. Is it possible that the stock price of Indymac could become $4.00 a share and is this a good investment?

Answer 1

If all you're talking about is $100 and you can afford to lose it then why hesitate? It can't go down any further (well not much anyway) and with the bailout that's about to happen, it has to go back up. If it doesn't go back up all you lose is a hundred bucks and it it does then all you do is gain. I wouldn't invest any more then you are willing to lose in your local poker game though.

Answer 2

Current shareholders are highly unlikely to get anything from Indymac.  Depositors & creditors are first in line.  If you like gambling, go for it.  Otherwise stay away.  I suspect Yahoo finance's projection is a little out of date.

I do think there are bargains in the financial sector right now.  I'm (slowly) starting to buy.  But not Indymac.

Answer 3

the $4 was from projections before the bank failed.

i would be shocked if debentures got paid in full, let alone common equity.  at this point, i wouldn't even invest in senior secured.

Answer 4

No, there is no chance of that. The company will be bought out by a bigger bank and you will wind up with one share of some major bank corporation if you're lucky. More probable than not you will wind up with nothing.

Answer 5

yes it's very very safe especially in our current environment...

hope you can see my sarcasm

keep it up with current market news and tell me you still want to invest in indymac.

Answer 6

If the shares have been beaten to a pulp then now would be the best time to buy.  the contrarians will be swooping in to snap it up; probably by the time you get there it will be too late already.

Most people look at $1 stocks and wait until the price goes up to $100 to buy.  This makes less sense than what you are suggesting.

Answer 7

Well the company is in receivership, the receiver will be liquidating the company.  

If you have a brokerage account already you could take a shot at it, but count on loosing your money,

If you don't have a brokerage account, no reputable brokerage firm will permit you to open an account for $100

With the company in liquidation, there's nothing left except the corporate shell.  Since it's not clean the chances of some one wanting it is slim to none.  

Just remember the saying, "a fool and their money are soon parted"