Fannie Mae And Freddie Mac’s Shareholders Might Not See Any Profits After All
The Motley Fool - October 4, 2014 - October 6, 2014
The Motley Fool, By Matthew Frankel
Over the past couple years, about 20 separate lawsuits have been filed with the goal of changing the profit-distribution arrangement of Fannie Mae (NASDAQOTCBB: FNMA ) and Freddie Mac (NASDAQOTCBB: FMCC ) . Specifically, both common and preferred shareholders are upset that the government decided to keep 100% of the agencies’ profits for itself.
Well, the hopes of shareholders just received a crushing blow as a U.S. District Court judge dismissed several of the lawsuits on Tuesday, causing shares to plummet by as much as 50% the next day. So what happens now? Is there still a chance that the remaining lawsuits will succeed, or should shareholders run for the exits?