Tuesday, June 07, 2005
Wintrust Financial (WTFC)
There's a lot of really great results they have to show me.
Just one problem. They don't pass the smell test. I could be wrong, but I don't trust companies that take in large amounts of cash every year from investors to rapidly expand. When that happens, it's possible to build something like a Ponzi scheme where new cash and new investments and new deposits can cover up ugly old investments and deposits. Net interest margin has been steadily declining over the years. A lot of little clues that I see on their website and in their reports give me the creeps. They remind me of shady used car dealers. And if you look at their cash flow statement, a huge part of it is buying and selling massive amounts of mortgage securities.