Home / Daily Dose / Altisource Shares Rise as CEO Reassures Firm’s Investors
Print This Post Print This Post

Altisource Shares Rise as CEO Reassures Firm’s Investors

Altisource Portfolio SolutionsShares of Altisource Portfolio Solutions picked up on Friday as the company's leadership assured shareholders about its near-term future after a year of setbacks.

In a conference call hosted ahead of Altisource's fourth-quarter earnings release, CEO William Shepro acknowledged that 2014 was "a trying time" for the firm's investors and employees as shares plunged nearly 80 percent.

The company's troubles last year can be traced to its relationship with Ocwen Financial Corp., which has faced a growing amount of scrutiny from federal and state regulators related to its growth and operations.

Though Altisource spun out from Ocwen in 2009, Moody's Investor Service estimates that it still draws approximately 65 percent of its revenues from the Atlanta-based business, and the two companies maintain a close enough relationship for some regulators to be concerned about conflicts of interest. The two also shared a chairman, Ocwen founder William Erbey, who was forced to step down as a result of a settlement Ocwen struck with New York's Department of Financial Services.

Shepro used a portion of Friday's call to reaffirm Altisource's support for the embattled Ocwen, adding that his company expects to continue earning by providing services on Ocwen's existing non-GSE portfolio. At the same time, he previewed Altisource's 2015 strategy, which focuses on expanding offerings into more diverse areas.

"The leadership team is committed and more focused than ever on our diversification and growth initiatives while supporting Ocwen," he said.

He also briefly addressed this week's news that California's Department of Business Oversight is seeking to suspend Ocwen's license to operate in the state based on the company's lack of response to requests for information about its compliance with statewide foreclosure protections. (In a response, Ocwen said it believes it has already turned over the required information but is cooperating with the regulator.)

While the news was enough to hamstring shares at both Altisource and Ocwen, Shepro didn't appear concerned about it.

"Our understanding is that the likelihood of Ocwen losing its license is very low, and Ocwen is working expeditiously to resolve the issue," he told investors.

Overall, the call seemed to do a good job appeasing shareholders. Altisource stocks jumped more than 60 percent in the hours following Shepro's remarks, while Ocwen stocks also climbed.

About Author: Tory Barringer

Tory Barringer began his journalism career in early 2011, working as a writer for the University of Texas at Arlington's student newspaper before joining the DS News team in 2012. In addition to contributing to DSNews.com, he is also the online editor for DS News' sister publication, MReport, which focuses on mortgage banking news.
x

Check Also

Federal Reserve Holds Rates Steady Moving Into the New Year

The Federal Reserve’s Federal Open Market Committee again chose that no action is better than changing rates as the economy begins to stabilize.