Sallie Mae Earnings Estimate Increased by FBR Analysts on Debt Acquisition
SLM Corp., the lender known as Sallie Mae, had its 2011 earnings estimate boosted 8.4 percent at FBR Capital Markets after announcing the acquisition of $28 billion of debt bundled and sold as bonds and related assets from Citigroup Inc.’s Student Loan Corp.
The debt acquisition “should serve as a catalyst for the stock,” the Reston, Virginia-based analysts wrote. They maintained their “outperform” rating and $19 price target for SLM shares. Sallie Mae rose 50 cents, or 4.5 percent, to $11.72 in New York Stock Exchange composite trading, the biggest gain since July 7.
The company, also based in Reston, is paying $1.2 billion for the debt assets, the analysts said.
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