Navient (NAVI) Stock Falls on Student Loan Forgiveness Threat
Shares of Navient (NASDAQ: NAVI ) are in the red following President Joe Biden’s decision to cancel $10,000 in student debt for individuals making less than $125,000 a year in income and for couples making less than $250,000 a year. Recipients of the Pell Grant who make less than $125,000 per year are eligible to have another $10,000 of student debt slashed. This news is unfortunate for NAVI stock, as the company operates as a student loan provider and collector. The company was first formed in 2014 by the split of Salle Mae into two entities: Navient and Sallie Mae Bank. Navient warned that in the event of student loan payment reductions, it could experience an “increase in prepayments, which could be significant, of our existing education loan portfolio and could materially and adversely impact our profitability, results of operations, financial condition, cash flows or future business prospect.” Student Debt Cancellation Weights on NAVI Stock Credit Suisse analyst Moshe Orenbuch mentioned that Navient would take a hit if privately held Federal Family Education Loan Program (FFELP) loans become eligible for forgiveness.
Navient (NAVI) Stock Falls on Student Loan Forgiveness Threat
Shares of Navient (NASDAQ: NAVI ) are in the red following President Joe Biden’s decision to cancel $10,000 in student debt for individuals making less than $125,000 a year in income and for couples making less than $250,000 a year. Recipients of the Pell Grant who make less than $125,000 per year are eligible to have another $10,000 of student debt slashed. This news is unfortunate for NAVI stock, as the company operates as a student loan provider and collector. The company was first formed in 2014 by the split of Salle Mae into two entities: Navient and Sallie Mae Bank. Navient warned that in the event of student loan payment reductions, it could experience an “increase in prepayments, which could be significant, of our existing education loan portfolio and could materially and adversely impact our profitability, results of operations, financial condition, cash flows or future business prospect.” Student Debt Cancellation Weights on NAVI Stock Credit Suisse analyst Moshe Orenbuch mentioned that Navient would take a hit if privately held Federal Family Education Loan Program (FFELP) loans become eligible for forgiveness.