Investors reacted favorably to the recent termination of mortgage lender UWM Holdings’ (UWMC) secondary public equity offering. Since the cancellation, shares rose more than 12 percent. The question is, “Is UWMC the right bet?” Given its poor earnings prospects and slowing housing market, You can read more. UWM Holdings Corporation, Pontiac, Michigan, the largest wholesale lender of mortgages in America, and the indirect parent to United Wholesale Mortgage, LLC, is publicly traded. On November 18, UWMC’s secondary offering of Class A stock and concurrent share repurchase was terminated by its principal shareholder SFS Holding Corp.

Regarding the termination of the offering, company Chairman and CEO Mat Ishbia said, “As the principal owner of SFS, I was willing to sell a percentage of our ownership in UWM at less than what I think to be fair value because we were advised that increased float in the public market would be beneficial for the UWMC shareholders, including its largest shareholder, SFS. SFS could also sell additional shares at the same price to meet our buyback promise and decrease the stock outstanding while maintaining the public float. Unfortunately, while there was more than enough demand from potential investors, the overall market conditions were such that the prices offered were not at levels that I will entertain.”

UWMC’s public float was expected to increase 50% following the secondary offering, substantially lowering its EPS and ROE. The investors have been positive about the decision to cancel this offering. Shares of UWMC have surged 12.3% in price since November 18 to close yesterday’s trading session at $6.93.

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