Ocwen Financial Earnings: Here’s Why the Stock is Rising Now

Ocwen Financial Corp. (NYSE:OCN) delivered a profit and missed Wall Street’s expectations, BUT beat the revenue expectation. The revenue beat is a positive sign to shareholders seeking high growth out of the company. Shares are up 4.69%.

Ocwen Financial Corp. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 60.61% to $0.53 in the quarter versus EPS of $0.33 in the year-earlier quarter.

Revenue: Rose 149.52% to $530 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Ocwen Financial Corp. reported adjusted EPS income of $0.53 per share. By that measure, the company missed the mean analyst estimate of $1. It beat the average revenue estimate of $515.88 million.

Quoting Management: “We are pleased with Ocwen’s strong core earnings and cash flow which should continue to grow with the boarding of our new acquisitions,” commented Bill Erbey, Ocwen’s Chairman. “Ocwen’s recently announced acquisition of OneWest Bank’s $78 billion servicing portfolio combined with other large bank transfers points toward continued growth as banks strategically reposition their mortgage servicing operations. Our current pipeline of potential new business opportunities on a probability-weighted basis exceeds $400 billion in unpaid principal balance (UPB). Moreover, regulatory and market trends, including greater prospects for GSE legislation and more private capital flowing into mortgage credit, provide excellent long-term prospects for Ocwen. We continue to build capacity in anticipation of further acquisitions to meet our obligations to our clients, borrowers, RMBS investors and shareholders.”

Key Stats (on next page)…

Revenue increased 28.69% from $411.84 million in the previous quarter. EPS decreased 14.52% from $0.62 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $1.32 to a profit $1.28. For the current year, the average estimate has moved down from a profit of $4.52 to a profit of $4.19 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)

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