SA News • Fri, Nov. 21
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There are 3 articles on this stock available only to PRO subscribers.
- Q3 Core EPS of $.80 missed analyst estimates by $.31.
- Revenue of $504.3 million thoroughly beat analyst estimates by $134.4 million, but was still down 20% year over year.
- The stock price tumbled upon opening and was down about 20% on the day.
- I didn’t predict the stock falling so hard and I am withdrawing my opinion.
- Management has stated that guidance will no longer be updated.
The Market May Be Almost Ready To Accept Nationstar Again
- The market has lost faith in NSM in the face of persistent regulatory pressure.
- This pressure will not last forever as similar events in the past show and when it subsides NSM should move higher fast.
- NSM's management is doing a good job with running the business and improving the profitability on the servicing side.
- At these valuation levels, NSM is still a very attractive investment.
Nationstar Isn't Taking Advantage Of Some Of Its StrengthsColoradoWealthManagementFund • Mon, Aug. 18
- Nationstar's filings are awkwardly assembled, but the content is there.
- Shareholder protections are important, but many companies in this sector ignore them.
- Our color-coded chart breaks down the good and bad for Nationstar.
Nationstar Mortgage: A Long But Profitable Road Ahead
- Regulatory headwinds are likely to persist in holding back NSM just as regulatory and legal concerns dogged banking stocks a few years ago.
- The company looks like a great value at today's prices though, so investors willing to endure some volatility should be able to benefit in the long run.
- All three of the firm's major segments are doing well and should have good growth ahead them.
Fri, Nov. 21, 9:47 AM
- Inline with Nationstar Mortgage's (NSM +2%) focus on leveraging technology to improve the property sale and purchase experience, Solutionstar has purchased Title365.
- The move follows this month's hiring of "technology innovator" Kal Raman as CEO of Solutionstar. Raman: "The acquisition of Title365 not only adds new technologies, products and third-party business to Solutionstar's portfolio, but its management team boasts a strong reputation as an industry innovator with decades of title industry experience."
- The deal is expected to close in January for $36M in cash, with additional consideration based on certain performance targets.
- Source: Press Release
Thu, Nov. 20, 1:19 PM
- Heavily-shorted Ocwen Financial (OCN +9.8%) is having a big session with no new news readily apparent at the moment. We already know Ben Lawsky is exiting the New York Department of Financial Services. Will his replacement be any softer on Bill Erbey's empire?
- Altisource Portfolio Solutions (ASPS +4.4%), Altisource Asset Management (AAMC +0.6%), Altisource Residential (RESI +2.1%), Home Loan Servicing Solutions (HLSS +1.8%)
- Ocwen competitors: Nationstar Mortage (NSM +4.7%), Walter Investment (WAC +4.7%).
- Previously: Specialty servicers on the move as Lawsky looks to be exiting
Fri, Nov. 14, 3:43 PM
- Alongside earlier news that the $39M MSR purchase deal with Wells Fargo is officially kaput, Ocwen FInancial (OCN -8%) has lost a fan in Leon Cooperman, whose Omega Advisors unloaded its stake - which had amounted to 1.26% of fund holdings - in Q3.
- Meanwhile, Nationstar Mortgage (NSM +4.9%) is nicely higher perhaps on speculation it could step in to buy all, or more likely part of the Wells Fargo MSRs.
- Turning back to the Ocwen family, Sterne Agee reminds that Altisource Portfolio Solutions (ASPS -6.3%) gets 70-75% of its revenue from Ocwen or Ocwen-owned and serviced loans.
- Altisource Residential (RESI -1%), Home Loan Servicing Solutions (HLSS -1.1%)
Tue, Nov. 11, 10:55 AM
- No one has come forward to deny yesterday's NY Post story leaking the imminent departure of Ben Lawsky from his job leading the New York Department of Financial Services.
- Hoping for a friendlier regime at DFS, Ocwen Financial (OCN +6.9%) continues a move higher which began when the story broke yesterday afternoon.
- Among competitors (also with regulatory issues, but maybe not at Ocwen's level): Walter Investment (WAC +4%) and Nationstar Mortgage (NSM -1.8%). Also of interest in the sector is PennyMac Financial Services (PFSI).
Mon, Nov. 10, 9:45 AM
- KBW downgraded Nationstar Mortgage (NSM -0.9%) to Underperform about a month ago, noting the stock's pricey valuation amid slowing MSR acquisition activity.
- Today - following the stock's post-earnings tumble last week and signs acquisition volume may not be as bas as thought - the team upgrades Nationstar back to Market Perform.
- It's Nationstar's 2nd upgrade in as many sessions following the earnings-related plunge on Thursday.
Fri, Nov. 7, 12:50 PM
- Yesterday's post-earnings, near-20% dive in Nationstar (NYSE:NSM) is good enough for Wells Fargo, which upgrades its rating on the stock to Market Perform from Underperform.
- "Fundamentally, we are very aligned with regulators," said CEO Jay Bray on the earnings call (transcript), responding to a question as to why some of Nationstar's peers (i.e. Ocwen, Walter Investment) aren't able to acquire more MSRs at the moment, but Nationstar had a fairly busy quarter for new commitments.
- "There's probably not a financial institution in America that wants to service defaulted loans," adds Bray, summing up in a sentence the bull case for the nonbank servicers.
- The stock's bounced 4% in today's session.
- Previously: Tough earnings day for mortgage servicers: Nationstar, Walter Investment, Stonegate all plunge
Thu, Nov. 6, 12:47 PM
Thu, Nov. 6, 12:31 PM
- Amid an earnings miss and lowered guidance, Walter Investment (WAC -20.2%) discloses inquiries from a number of state agencies into its Green Tree Servicing unit.
- Previously: Walter Investment reports sizable decline in earnings
- Earnings fell at Nationstar Mortgage (NSM -20.6%), but in a bit of good news, the company did say it entered into commitments for $43B in new MSR acquisitions.
- Finally, there's lesser-followed Stonegate Mortgage (SGM -15.9%), which went public just more than a year ago, missing estimates by a wide margin with CEO Jim Cutillo noting "industry headwinds and interest rate volatility." The company's servicing portfolio ended Q3 with $17.7B UPB, up 48% this year and up 82% Y/Y.
- New Residential (NYSE:NRZ) - a specialty servicer, but with a somewhat different business model than the other three - reported solid results today and is flat on the session.
Thu, Nov. 6, 7:35 AM
- Q3 core earnings of $72.7M or $0.80 per share vs. $90.2M and $0.87 in Q2.
- Continued increase in recurring fee-based earnings, with 70% of pretax income from servicing and Solutionstar vs. 60% in Q2.
- Servicing portfolio UPB is about unchanged from Q2 as nearly 100% of runoff was replaced. Since Q2's end, Nationstar (NYSE:NSM) has entered into commitments for $43B in new MSR acquisitions.
- Solutionstar segment pretax income of $35M down 8% Q/Q, with real estate exchange revenue of $25M down 30% and real estate services revenue of $60M up 28%. Margin fell to 41% from 46% thanks to the higher mix of revenue coming from services. REO ending inventory of 9.639 up 10%. "Technology innovator" Kal Raman brought in as CEO of Solutionstar.
- Originations segment pretax income of $54M down 22% Q/Q (seasonality at work).
- Conference call at 9 ET
- Previously: Nationstar misses by $0.31, beats on revenue
Thu, Nov. 6, 7:20 AM
Wed, Oct. 22, 11:06 AM
- Bank of America and Evercore Partners throw in the towel on Ocwen Financial (OCN -8.5%), downgrading to Neutral/Hold, following yesterday's letter from Ben Lawsky's NY Dept. of Financial Services and the company's bungled response.
- Is it time to start thinking about a takeout? Sitting on Ocwen's board and presumably still a sizable shareholder is Wilbur Ross (NASDAQ:WLRH) who sold his Homeward Residential Holdings to Ocwen in 2012.
- Altisource Portfolio Solutions (ASPS -9.6%), Home Loan Servicing Solutions (HLSS -5.3%), Altisource Asset Management (AAMC -4.3%), Altisource Residential (RESI -4.5%).
- Other industry players: Nationstar Mortgage (NSM), Walter Investment (WAC +0.5%), New Residential (NRZ +0.1%), PennyMac FInancial (PFSI -0.4%).
- Previously: Moody's downgrades Ocwen following DFS allegations
Tue, Oct. 21, 12:25 PM
Mon, Oct. 6, 3:14 PM
- "While we continue to think the regulatory overhang on the industry will eventually be lifted, we still expect servicing acquisition activity to remain slow," says KBW in its latest report on nonbank mortgage servicers.
- The long-term EPS trend is down thanks to: 1) An increase in the percentage of new, lower-return, prime servicing; 2) A reduction in ancillary fees such as those from HAMP and late fees; 3) A reduction in mortgage banking income driven by the end of HARP next year.
- While Nationstar (NSM -0.9%) was downgraded to Sell, Ocwen Financial (OCN -2.1%) and Walter Investment (WAC -0.4%) had their price targets cut to $28 from $33, and $22 from $26, respectively.
- New Residential (NRZ +3.2%) and Home Loan Servicing (HLSS +0.6%) - partner servicing companies to Nationstar and Ocwen - however, were reiterated as Outperforms as both are well-positioned to maintain dividends into 2015. "As we noted earlier," says KBW, "servicing sales will continue, albeit at a slower pace than in the past."
- Previously: Nationstar Mortgage downgraded at KBW
Mon, Oct. 6, 8:00 AM
Tue, Sep. 30, 1:29 PM| 4 Comments
Mon, Sep. 29, 9:42 AM
NSM vs. ETF Alternatives
Nationstar Mortgage Holdings Inc. is engaged in the services of residential mortgage loans, mortgage and default service offerings, and single-family mortgage loans to GSEs or third party investors in the United States.
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