Countrywide's Mozilo is Selling Out

Starting with the Wall Street Journal a week ago much has been made of the fact that Angelo Mozilo, the Chairman and CEO of Countrywide Financial Corporation, has been engaging in a bit of doublespeak as of late. On the one hand he and CFO Eric Sieracki have been vigorous defenders of Countrywide's financial position. Mr. Sieracki called the company a "well-conditioned athlete" -- whatever that means. Mozilo appeared on CNBC this morning and said he felt it was unfair that investors were lumping "diversified financial services companies" like Countrywide and Wells Fargo (anyone else think comparing CFC with WFC is a bit of a stretch?) in with companies like New Century, NovaStar and Accredited Home Lenders. He described those companies as mono-line subprime lending companies. On the other hand, Mozilo has been exercising options and dumping Countrywide shares like they are going out of style. See the graph below courtesy of the SEC:


In Angelo's defense he has been systematically liquidating shares for quite some time. However, you can notice just from glancing at the chart above that the pace has quickened in recent months. By my calculations he has liquidated $69,918,490 worth of Countrywide shares since the beginning of December 2006.

Countrywide is one of the lenders that will most likely survive the subprime meltdown. Only 10% of their loan portfolio is technically "sub-prime." Though 15% of their loans over the past 2 years are considered Alt-A loans. There will probably be plenty of volatility ahead for Countrywide and while the company will survive it may not survive as an independent company. The stock is off 19% on the year and is trading at a P/E multiple of 8. There may be a sale sign out in front of their Calabasas Headquarters in the near future.