logo
Sign in or Register

Already a member?

Sign in

Or sign in with your account on:

Not a member yet?

Register
    

Doral Financial Wins Appellate Case, Shares Skyrocket

  +Follow July 2, 2014 11:54AM
Share:
Tickers Mentioned:

small-cap stocks, small-cap stars, stocks to buy now, Doral Financial stock

On July 2 Doral Financial (DRL) saw shares surge more than 70 percent at one point before backing off slightly on a decisive court victory over the government of Puerto Rico.

In a statement to stockholders, Doral claimed an appellate court had overturned an earlier ruling that favored Puerto Rico in the ongoing war over a whopping $230 million in tax refunds Doral claims they are still owed. The Puerto Rican government has tried to nullify this repayment, and Doral’s challenge had been previously thrown out by a lower court over jurisdiction issues.

Doral In Dire Straits

While $230 million in tax refunds is welcomed by any company, the cash-strapped Doral is in especial need of the funds. The lender has struggled to maintain a sufficient amount of Tier 1 capital as required by banks in the wake of the 2008 financial meltdown. An accounting discrepancy of Doral’s, in which the lender was cited for using inappropriate assets in their capital requirements, exacerbated the bank’s shortfall.

Doral has claimed that if push comes to shove they can sell assets to meet their requirements. But that is a scenario the company’s beleaguered stockholders would definitely not like to see.  

In an effort to shore up their reserves while satiating their shareholder’s interests, Doral has been aggressive in their quest for the $230 million in total they feel they are owed. Unsurprisingly, San Juan has been loath to pay the money back, and has repeatedly tried to stonewall them through a lengthy court battle.

As the battle has see-sawed between Doral and the Puerto Rican government’s favor, so has Doral’s stock.  Shares of the lender have whipsawed. Shares went from $3 to $5 a share from June 3 to June 10 on the heels of a major victory in the Puerto Rico Supreme Court. After the bounce though, shares plummeted near the $4 range, but then popped again on the July 2 ruling to above $6.50. Even after the recovery, the company’s stock is still down 60 percent in 2014.

A Deeper Look at Doral

 Despite their woes, as an investment Doral still maintains some promising fundamentals. According to the equities.com EVA reports, Doral’s Net Margin is much higher than the industry average, which ia a very positive sign for the company. Doral’s return on equity (ROE) is also higher than average, indicating that the company is not overleveraged in comparison to its peers.

For the near-term future however, investors will be looking less at fundamentals and more at the decisions made by the Puerto Rican courts. If their home government is indeed on the hook for such a massive repayment, Doral’s shares will be sure to skyrocket.

Of course, the reverse is true, and if Doral does not reclaim the taxes they claim they overpaid, they will be forced to liquidate assets, and the company’s stockholders will be in store for some pretty significant losses.

By 3 PM EST shares of Doral were trading at $6.46 a share, representing a gain of 60.3% on the day.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.


Liked What You Read? Join Equities.com as a contributor and get eyeballs on your content FOR FREE!

Results for DRL
Adam Cole
30 Aug 14 17:02:14
RT @PhilCheeze: $DRL Keep a very close eye on it as we approach the court date. I expect to see a spike upon any settlement deal made ~
PhilCheeze
30 Aug 14 15:56:52
RT @BayAreaCoins: What am I holding today... $BTC, $HUC (those are my cryptos) $WIN my bread and butter. $DRL for my long shot with a chan…
PhilCheeze
30 Aug 14 15:56:41
RT @CanopyCrest: Excellent article on why Doral could NOT accept Puerto Rico's settlement offer: It's a scam. $DRL http://t.co/eb5TiBV7Cn
PhilCheeze
30 Aug 14 15:56:25
RT @ABradWilliams: $DRL: Doral Financial wins round in Puerto Rico legal case, shares jump http://t.co/1SzEGWuOvu http://t.co/ROoMmDgMfb
PhilCheeze
30 Aug 14 15:56:00
RT @WhiteCoatMafia: @SneakyPHolsters If $DRL settles before court, and I think there's a good chance, then my bet is DRL hits before $GERN.
PhilCheeze
30 Aug 14 15:32:52
$DRL Keep a very close eye on it as we approach the court date. I expect to see a spike upon any settlement deal made ~
PennyStock Zone
30 Aug 14 13:58:48
Best day trading DVD by Fous Alerts check it out! http://t.co/HJ6WDp65fM #stocks #trading #nasdaq #nyse $DRL $CRM $JRJC $GME $BAC $EBAY
PennyStock Zone
30 Aug 14 10:51:42
Multimillionaire trader SUPERTRADES and his EASY to replicate strategy can make you money! http://t.co/Ho9ydXHTWl $DRL $GST $NUAN $UVXY
Financial Headlines
30 Aug 14 10:15:17
$DRL: Doral Financial (DRL), Puerto Rico Treasury Department Extended Negotiations ... http://t.co/pMxl45H8xD http://t.co/1UZt5eAnhG
PhilCheeze
30 Aug 14 10:11:28
Doral Financial Corp. $DRL | Stock Message Board - Investors Hangout http://t.co/6Zj9CzK4qr
Derald Muniz
30 Aug 14 08:56:09
50/50 Basket to end the week: $DRL $GLUU $JRJC $LEJU $PBYI $TKMR $VJET
Edward Robinson
30 Aug 14 08:54:10
RT @1nvestor: Newly added (personal) this week that survived to the weekend: $QIHU $ACHN $PBR $WDAY $SAFM $ARUN $TIF $SIG $AVGO $LEJU $DRL
Derald Muniz
30 Aug 14 08:53:13
Newly added (personal) this week that survived to the weekend: $QIHU $ACHN $PBR $WDAY $SAFM $ARUN $TIF $SIG $AVGO $LEJU $DRL
PennyStock Zone
30 Aug 14 08:12:10
Best day trading DVD by Fous Alerts check it out! http://t.co/AeQ95GG2rM #stocks #trading #nasdaq #nyse $DRL $CRM $JRJC $GME $BAC $EBAY
PennyStock Zone
29 Aug 14 21:41:47
Best day trading DVD by Fous Alerts check it out! http://t.co/HJ6WDp65fM #stocks #trading #nasdaq #nyse $DRL $CRM $JRJC $GME $BAC $EBAY
Bulls vs Bears
29 Aug 14 20:15:20
$DRL: Slumping Stocks: Adept Technology Inc(NASDAQ:ADEP), Doral Financial Corp ... http://t.co/muEiJgTJEk http://t.co/VhPQGMQHF7
Bloody Mary
29 Aug 14 19:42:52
RT @puertoricoguru: PR economic index drops again - Caribbean Business http://t.co/qS6TzXquJg $BPOP $DRL $OFG $FBP #PReconomy #muniland
Wilo Ramos-Ferrer
29 Aug 14 19:37:02
RT @puertoricoguru: PR economic index drops again - Caribbean Business http://t.co/qS6TzXquJg $BPOP $DRL $OFG $FBP #PReconomy #muniland
Adam Cole
29 Aug 14 19:29:20
@SneakyPHolsters My dream trade would be to hit $DRL, then roll into more $GERN. If $BABA shows up in the interim, that's also on hit list.
PennyStock Zone
29 Aug 14 19:25:13
Best day trading DVD by Fous Alerts check it out! http://t.co/HJ6WDp65fM #stocks #trading #nasdaq #nyse $DRL $CRM $JRJC $GME $BAC $EBAY
Adam Cole
29 Aug 14 19:21:38
@SneakyPHolsters If $DRL settles before court, and I think there's a good chance, then my bet is DRL hits before $GERN.
Adam Cole
29 Aug 14 19:20:45
@SneakyPHolsters It's unfortunate $GERN and $DRL have similarly timed catalysts. If $DRL goes to court, who knows which happens first. But..
Neva Winter
29 Aug 14 18:20:36
New Study Examines the Costs $DRL http://t.co/9lPaUYMwLL
Oralia Butler
29 Aug 14 18:19:26
New Study Examin $DRL http://t.co/N4X7WKUn3W
Market News
29 Aug 14 16:15:17
$DRL: Why Doral Financial (DRL) Stock Is Soaring Today http://t.co/ptKHsJ24LR http://t.co/WHrco7kffC
PR Guru
29 Aug 14 15:42:44
PR economic index drops again - Caribbean Business http://t.co/qS6TzXquJg $BPOP $DRL $OFG $FBP #PReconomy #muniland
PR Guru
29 Aug 14 15:40:59
PR Economic Activity Index July 2014 http://t.co/TBsoBpiEq1 … $BPOP $DRL $OFG $FBP #PReconomy
Michael
29 Aug 14 15:22:05
@WhiteCoatMafia I'm curious, do you feel that a catalyst for $DRL is closer than $GERN?
PennyStock Zone
29 Aug 14 14:41:43
Multimillionaire trader SUPERTRADES and his EASY to replicate strategy can make you money! http://t.co/Ho9ydXHTWl $DRL $GST $NUAN $UVXY
$Stocknewsalerts
29 Aug 14 14:03:35
$DRL Doral Financial Corporation Daily Stock Price Summary From our Stock News Alerts App
John Giangreco
29 Aug 14 13:33:23
RT @WhiteCoatMafia: Now with 35,000 $DRL shares at avg $6.85
Business Updates
29 Aug 14 13:15:19
$DRL: DORAL FINANCIAL CORP Files SEC form 8-K, Other Events http://t.co/5D4s5EJCLJ http://t.co/Sul0LWNw0e
Adam Cole
29 Aug 14 12:56:52
Now with 35,000 $DRL shares at avg $6.85
Instaya
29 Aug 14 12:22:54
$DRL The American Rose: Nice Try #PuertoRico. #Banks Weren't Born Yesterday http://t.co/gBhKbPNXxd @agarciapadilla @Sincomillas #doralbank
PennyStock Zone
29 Aug 14 11:46:08
Best day trading DVD by Fous Alerts check it out! http://t.co/HJ6WDp65fM #stocks #trading #nasdaq #nyse $DRL $CRM $JRJC $GME $BAC $EBAY
PennyStock Zone
29 Aug 14 10:41:05
Multimillionaire trader SUPERTRADES and his EASY to replicate strategy can make you money! http://t.co/Ho9ydXHTWl $DRL $GST $NUAN $UVXY
Adam Cole
29 Aug 14 10:27:03
@puertoricoguru True. But investors do know $DRL is currently priced like a dead fish. Discount sell -> restructured survival -> 🐂 profit 🐂
ENGIN BUYUKARSLAN
29 Aug 14 09:52:37
@Massman0134 What do you mean buddy? by the way I am out of $drl till court time. I go better stock now before come back to drl
Stocks in News
29 Aug 14 09:15:19
$DRL: Doral Financial wins round in Puerto Rico legal case, shares jump http://t.co/1SzEGWuOvu http://t.co/ROoMmDgMfb
colsdaddy
29 Aug 14 08:40:16
The American Rose: Nice Try Puerto Rico. Banks Weren't Born Yesterday. http://t.co/vkpOGIgqCw The real issues between $DRL and PR Treasury.
Adam Cole
29 Aug 14 08:23:57
@puertoricoguru Here is the link. Only $DRL "plan" is due after 120 days. See link and pic. http://t.co/VVHc9LtcTB http://t.co/Hj1E2r8eEA
Adam Cole
29 Aug 14 07:53:43
$DRL The American Rose: Nice Try Puerto Rico. Banks Weren't Born Yesterday. http://t.co/IfYdKVk6LH
Adam Cole
29 Aug 14 07:53:04
@puertoricoguru This is a lie. FDIC cannot take over. $DRL 'plan' is due. Just the plan. Not the capital.
PR Guru
29 Aug 14 07:37:22
Unless we hear news on $DRL capital plan, very risky to hold stock over long weekend.FDIC could takeover.Trial contingency might be too much
Stock Market News
29 Aug 14 07:15:20
$DRL: Sector Update: Moderate Gains for Financial Stocks; Doral Financial Sinks ... http://t.co/JIkJwQzuot http://t.co/0DTyD70Sll
CC Investments
29 Aug 14 07:14:08
Excellent article on why Doral could NOT accept Puerto Rico's settlement offer: It's a scam. $DRL http://t.co/eb5TiBV7Cn
BayAreaCoins
29 Aug 14 07:07:09
What am I holding today... $BTC, $HUC (those are my cryptos) $WIN my bread and butter. $DRL for my long shot with a chance of high return!
PR Guru
29 Aug 14 06:15:55
@Jgian1217 $DRL is running out of time with the FDIC. The stock could pop if they sell US operations to meet capital requirements.
John Giangreco
29 Aug 14 06:15:35
RT @WhiteCoatMafia: No $DRL short attack yesterday. Futures up despite Ukraine. Obviously no FDIC seizure today. Anymore failed bear "predi…
John Giangreco
29 Aug 14 06:15:24
RT @Matttherose: Nice Try Puerto Rico. Banks Weren't Born Yesterday. $DRL http://t.co/UFCg2hHKYy Why PR will lose at trial with Doral...
				
				
  +Follow July 2, 2014 11:54AM
Share:

Comments

 

blog comments powered by Disqus

About us

Equities.com is the most advanced interactive online social ecosystem for the financial industry, serving as a resource center and next-generation communication platform that connects self-directed investors with public issuers, market experts, and professional service providers and vendors. Registered members can leverage our exclusive proprietary research tools such as the Small-Cap Stars, which outperformed 90% of all small-cap mutual funds, and robust do-it-yourself E.V.A. research reports. The Equities.com Issuer Dashboard is the ideal tool to communicate and manage investor awareness campaigns to the investment community, as well as to access valuable resources to help your company grow.

Market Data powered by QuoteMedia.
Copyright © QuoteMedia. Data delayed 15 minutes unless otherwise indicated. Terms of Use.