Bill Pulte Issued a Warning on Freddie Mac Stock. Should You Ditch Shares Here?

Core Insights - Freddie Mac and Fannie Mae stocks have surged over 200% this year due to potential privatization discussions by the Trump administration [1] - Despite the interest in privatization, concerns remain regarding the risks associated with Freddie Mac, as highlighted by the Federal Housing Finance Agency director [2][3] Company Overview - Freddie Mac, officially known as the Federal Home Loan Mortgage Corporation, was established in 1970 to assist smaller banks in financing long-term fixed-rate mortgages with low down payments [4] - The company has a market capitalization of $6.6 billion, making it smaller than Fannie Mae, and its stock has increased by 231% this year, although it is currently trading 28% below its 52-week high [5] Historical Context - Both Freddie Mac and Fannie Mae have been under government conservatorship since the 2008 financial crisis, which was triggered by risky loans and securities, including subprime loans [6] - They have since paid billions in dividends to the U.S. government, exceeding the amount received during the bailout, and are now profitable [6][7] Financial Reporting - Freddie Mac, like other publicly traded companies, files an annual 10-K report that includes financial statements, risk disclosures, and management commentary [7]