Looking golden at the moment is Compass Point's Kevin Barker, who stepped into yesterday's major decline in the specialty servicers with an upgrade to Ocwen Financial (OCN +3.9%). The decline was sparked by a story - later confirmed by Ocwen - that Ben Lawsky's NY Dept. of Financial Services had blocked Ocwen's purchase of MSR's from Wells Fargo.
If Lawsky's concern is Ocwen's ability to properly service a massive influx of new loans, this isn't an issue, says Barker as the company can take steps to ensure compliance. If Lawsky is upset about Ocwen's current servicing practices, that's a more complicated issue, but Barker doesn't believe this to be so.
He's got a price target of $60 assuming the Wells deal gets done and Ocwen continues buying MSRs, and utilizes free cash flow for stock repurchases or an accretive acquisition.