Underwriter coverage rolls in on Medley Management (MDLY +2%) one month after the IPO, with Gllford Securiites and KBW both recommending investors buy the stock.
"Medley is 100% focused on the high-growth alternative credit asset class and lacks the negative growth 'baggage' of traditional active fund classes," says Credit Suisse's Craig Siegenthaler, who yesterday started the stock at Outperform with $23 price target. His 2015 dividend estimate of $0.88 per share implies a 5-6% yield vs. around 2.5% for the traditional C-Corp peers. "Medley is the highest yielding C-Corp asset management stock in the U.S."
Deutsche also starts the stock with a Buy and Goldman rates the shares at Neutral.
All this talk over the last few days about a material loosening coming in mortgage standards is a whole lot of nothing, says CYS Investments (NYSE:CYS) CEO Kevin Grant, speaking on the earnings call. As far as he knows, the CFPB hasn't signed on to even a little bit of the FHFA plan to try and ease underwriting standards, and Grant has no reason to expect the agency will budge.
The CFPB's mandate - he reminds - is to limit risk, so why would it do anything but allow only essentially perfect credits to get mortgages.
Asked about whether CYS is ready to deploy its buyback authorization, Grant says the best place to put capital to work right now is in the "cheap" mortgage market. He notes CYS put $1.5B to work in mortgages in Q3.
As for the tumult of the last couple of weeks, Grants notes the thin trading desks and inventories at the big banks mean big moves in prices during such dislocations, and CYS is happy to step in as a buyer during these events.
CYS is lower by 1.2% in early action as core earnings dipped last quarter - just covering the dividend - and book value dropped a bit.
At issue are charges of rigging Swiss franc Libor benchmark interest rates, and JPMorgan (NYSE:JPM), UBS, and Credit Suisse (NYSE:CS) will be collectively fined more than $115M, reports Reuters. Not being penalized is RBS thanks to its role as a whistleblower in the case.
JPMorgan is reportedly set to receive the biggest fine at about $89M.
Gladstone Investment (NASDAQ:GAIN) teams with certain members of the Old World Christmas management team to buy out the company. Founded in 1979, Old World Christmas is a designer and distributor of Christmas ornaments and cars into the independent gift channel.
Q3 net income of $44.2M or $0.32 per share vs. $44.3M and $0.32 in Q2. Excluding net litigation-related expenses, restructuring charges, and Visa indemnification charges, net income was $51.3M or $0.37 per share.
Net interest income of $206.3M vs. $205.1M in Q2, with NIM of 3.37% down four basis points.
Noninterest income of $64M vs. $63.4M in Q2, with mortgage banking income off 11.7% thanks to lower gains on sale. Mortgage origination volume of $197M vs. $188M.
Noninterest expense of $193.7M up $11.6M on the quarter thanks to litigation-related expenses. Adjusted out, noninterest expense of $166.8M slipped 1.6%.
Total credit costs of $15.7M fell 7.2% Q/Q and 29.8% Y/Y. Net charge-offs of $12.3M fell 65.4% from Q2.
Tier 1 Common Equity ratio of 10.6% up 18 basis points.
$250M share repurchase program announced, along with an increase in the dividend to $0.10 from $0.07.
Saying rent coverage in the HCR Manor Care portfolio is unlikely to improve in the near future and acquisition volumes remain weak, Jefferies cashes in its chips on its Buy call for HCP, cutting to Hold with price target lowered to $45 from $47.