Altisource Portfolio Solutions SANASDAQ
Altisource Portfolio Solutions: Deep Value Opportunity?
Michael Boyd • 41 Comments
Michael Boyd • 41 Comments
7 Reasons To Buy Altisource Portfolio Solutions
Weighing Machine • 12 Comments
Weighing Machine • 12 Comments
Thu, Nov. 17, 1:16 PM
- The refinance of the company's bank loan out of the way, Ocwen (OCN +2%) moves to refinance its Senior Secured Term Loan, with Bloomberg reporting pricing on the $335M deal in the area of Libor +575 basis points and (like the bank loan) a 2022 maturity.
- It wasn't long ago that the SSTL had a balance well north of $1B, and Ocwen faced a major penalty if it didn't refinance by next June.
- The debt extensions out of the way, Ocwen is presumably in position to go on offense, i.e. start buying MSRs again. The regulators, of course, will have to sign off first, but that's looking more hopeful now than it would have a few months back.
- The news is also of interest to Altisource Portfolio Solutions (ASPS), which counts Ocwen as its largest client.
Wed, Nov. 16, 11:21 AM
- Ocwen Financial (OCN +1%) announces the tender of nearly all of its 6.625% Senior Notes due in 2019; to be exchanged for Senior Secured Second Lien Notes due in 2022 at 8.375%.
- Altisource Portfolio Solutions (ASPS +1.6%) investors are pressing that company to consider a similar extension as that would give the management team the "runway" to execute on its strategic initiatives.
- Further, some are urging Altisource to fry the shorts by issuing up to $100M in convertible preferred debt and using the proceeds to tender for common stock. Considering the limited float and average volume in the area of 400K shares per day, it could set off quite the squeeze.
Thu, Oct. 27, 8:38 AM
- CEO Bill Shepro: "We have not achieved our very high growth expectations for 2016." In Servicer Solutions, he notes it's taking "substantially longer than anticipated" to achieve stable revenue flows from new customers and close deals from what the company believes is a "robust pipeline" of opportunities."
- In Consumer Real Estate Solutions, Shepro says the company is seeing plenty of interest after expanding to 18 markets. Trouble is, Altisource wasn't prepared with enough boots on the ground to give an acceptable "in-person" experience. A change in the operational model is underway.
- Q3 servicer revenue of $252.7M vs. $272.8M a year ago. Adjusted pretax income of $29.4M down from $50.5M. Adjusted EPS of $0.90 down from $2.27.
- 500K shares bought back during quarter for $14.6M.
- Conference call at 11 ET
- Previously: Altisource Portfolio beats by $0.02, beats on revenue (Oct. 27)
- ASPS -6.15% in very thin premarket action.
Thu, Oct. 27, 8:25 AM
Wed, Oct. 26, 5:30 PM
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Mon, Oct. 24, 8:02 AM
- Altisource Origination Services today is being rebranded to Trelix. As before offerings include: Processing, Underwriting, Loan Due Diligence, Quality Control, and CastleLine Certification.
- Trelix early next year plans to launch a technology platform intended to improve lenders' competitiveness by better managing regulatory obligations and helping effectively scale business.
Mon, Oct. 17, 2:36 PM
- "After 18 months of intense corporate challenges caused by their prior rapid growth, regulatory fines and sanctions, and spillover from what I consider bad behavior from a conflicted lobby group, Ocwen (NYSE:OCN) has now turned the corner and is on road profitability," writes John Devaney updating his bull thesis on the company in a sizable report, which also touches on other industry participants like ASPS, NRZ, NSM, WAC, and PHH.
- "The past four months have seen a series of meaningful events that have greatly de-risked the company and added credibility to the management and the company’s reputation."
- The stock represents deep value, says Devaney, noting tangible book value north of $10 per share, a stock price of just $3.60, and possibly $1 per share in earnings next year. He's got a price target of $6.75 by year-end 2017.
Fri, Sep. 30, 3:11 PM
- The company has purchased a portfolio of 4,262 single-family homes for $652.3M from funds sponsored by Amherst Holdings.
- The deal more than doubles Altisource's (RESI +2.1%) single-family rental portfolio, and puts the company on track to hit its goal of having 10K rental properties by the end of the year.
- RESI was able to secure seller financing for 75% of the purchase price. As part of that deal, the company is keeping the current property manager, Main Street Residential. Altisource Portfolio (ASPS +2.8%) will remain the manager of RESI's other REO and single family rental properties.
- ASPS waived its exclusivity provision with RESI in order to help seal the deal, and in return got an agreement entitling it to a contingent liquidation fee of $60M in the event RESI decides to liquidate 50% or more of its SFR portfolio managed by Altisource.
- AAMC +11.85%
Mon, Sep. 26, 4:01 PM
- After meeting with RESI management, analyst Brock Vandervliet, says the company remains on target with the financial goals outlined after Q2 earnings.
- There's also the previously disclosed LOI to purchase 4.5K homes. Vandervliet believes RESI is just a short time away from formalizing, and it would mark the company's first major rental home acquisition this year, bringing home count to nearly 8K units vs. the year-end goal of 10K.
- Management is confident there are plenty of other bulk acquisition opportunities out there. And by outsourcing property management (presumably to ASPS), the company has a high degree of geographic flexibility for future purchases.
- He maintains his Buy rating, and the $15 price target compares to the current $10.65.
Wed, Sep. 21, 11:05 AM
- In the wake of the SEC charging Leon Cooperman with insider trading over Atlas Pipeline Partners, other Cooperman/Omega holdings have turned sharply lower.
- Altisource Portfolio (ASPS -5.2%), Navient (NAVI -2%), Aercap (AER -4.3%), Tribune Media (TRCO -6.3%)
- Previously: Leon Cooperman charged with insider trading (Sept. 21)
- See also: A check of Cooperman's top holdings after SEC charges (Sept. 21)
Tue, Sep. 20, 4:46 PM
- via Bespoke - see table
- Five of the stocks have > 50% of their shares sold short.
- SHLD leads the pack.
Wed, Sep. 7, 7:46 AM
- The company's mortgage servicing clients will have additional accelerated disposition strategies from ASPS's new Foreclosure Auction Services, including support for the FHA's Claims Without Conveyance of Title program.
- The new services include pre-foreclosure marketing utilizing Hubzu, onsite foreclosure auctioneering, and online second chance auctions (again utilizing Hubzu).
Tue, Aug. 23, 10:56 AM
- A bear on Ocwen Financial (OCN +3.7%) in the $20s, Oozing Alpha turned bullish at around $1.60 per share earlier this summer. The stock has since about doubled, but the author believes risk-reward is even better today than it was in June.
- Why? Ocwen faced an existential threat then - without an S&P upgrade to its servicer rating, the company was at risk of losing half its business in 2017. That upgrade came two weeks ago.
- With $5.27 per share in tangible book value, $4 per share of off-balance sheet assets, and a lending business that could be worth at least $1 per share, Ocwen has intrinsic value north of $10 per share, says the author, but with no reason to believe a sale is imminent, it will take awhile to realize this valuation.
- He sees $5.50 per share in 18-24 months, and if the company manages to begin growing again, $10 per share or more is possible.
- Related: Altisource Portfolio Solutions (ASPS +3.8%), Altisource Residential (RESI +6.2%) - which was upgraded to Buy at Nomura today.
Sat, Aug. 13, 2:46 PM
- Leon Cooperman's Omega fund added more than 123K shares to its already considerable stake in Altisource Portfolio Solutions (NASDAQ:ASPS), picking up about 23K shares on July 29 at $22.52 each (amid the plunge that week on worry Bill Erbey was cutting his holdings), and roughly 100K shares on Aug. 10 at $29.07 each.
- The August 10 purchases were made one day after Ocwen Financial's (NYSE:OCN) servicer rating was upgraded at S&P. ASPS closed on Friday at $29.95.
- Previously: Cooperman: Let's take Altisource Portfolio private (March 10)
Tue, Aug. 9, 4:18 PM
- Ocwen Financial's (OCN +15.2%) servicer rating is boosted back to Average from Below Average at S&P.
- The long-hoped-for (at least by Ocwen bulls) move eliminates a major overhang - the idea that NRZ might transfer servicing from Ocwen - from the stock price. The action would also seemingly be a key step in allowing Ocwen to return to growth by re-entering the market for MSR acquisitions.
- The stock jumped 15% to $2.66 in the last minutes of the regular session, and is changing hands for $2.73 after hours.
- ASPS +2.5%
Mon, Aug. 8, 10:03 AM
- An upgrade to "average" servicer rating is crucial not just to Ocwen Financial (OCN +3.1%) stakeholders, but to the entire servicing industry, writes John Devaney of United Capital Markets, in an open letter to S&P.
- The bottom line according to Devaney, citing the recent LL funds White Paper and his contacts who make up a sizable proportion of holders of RMBS serviced by Ocwen: Ocwen is tops in the industry, and the RMBS owners have no desire to see servicing transferred away from the company.
- Recent news further supports an upgrade, argues Devaney, noting the possible nearing of a settlement with the California monitor, the settlement of the Qui Tam case, and a Moody's report saying Ocwen is #1 in cure rate and cash flow.
- He notes Ocwen is stuck in a bureaucratic negative feedback loop in which regulators want to see the company upgraded before greenlighting more MSR buys, but S&P wants to see Ocwen greenlighted for those buys before it upgrades. He reminds Ocwen is also being held back by the perception New Residential (NYSE:NRZ) could exercise its option to transfer servicing from Ocwen should an upgrade not happen by early next year. Devaney doesn't believe NRZ would do this as returns would go down, but the issue nevertheless is out there.
- Other tickers of interest: ASPS, RESI