ASPS - Altisource

[peridotcapital]

http://adventuresincapitalism.com/2019/08/12/altisource/

 

Trying to read up on this. Any bear-case refelections?

 

I just reread his post and realized that he is using TTM operating income figures, which include earnings from businesses they have now sold. I was trying to figure out why he thought they can do 100M+ pre-tax next year (50% above 2019) when the company itself is guiding to flat results year over year. All of the savings that Kuppy added back are simply going to offset the decline in the OCN business and the divisions that were sold.

 

Now, the stock is still cheap even if FCF is 60M instead of 100M, but that has been the case forever because the business is not growing. So you need a catalyst and Kuppy says it is a surge in RE defaults in 2020. I don't see any reason to believe that will happen, but it would get the stock moving for sure.