New Century Financial downgraded to "market perform"

06/15/06 - JMP Securities

NEW YORK, June 15 (newratings.com) - Analyst Jim J Fowler of JMP Securities downgrades New Century Financial (NEW) from "market outperform" to "market perform," while reducing his estimates for the company.

In a research note published yesterday, the analyst mentions that the company's recently posted production volumes indicate continued robust origination activity. Although New Century Financial's margins are likely to improve in the near-term, the company's performance metrics would deteriorate to reflect the recent changes in the S&P's securitisation model unless its mortgage pricing becomes more aggressive, the analyst adds. The EPS estimates for FY06 and FY07 have been reduced from $7.00 to $6.74 and from $7.15 to $6.00, respectively.