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QC Holdings, Inc. Message Board

johnwrandall 10 posts  |  Last Activity: Aug 20, 2015 2:10 PM Member since: May 18, 2001
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  • Reply to

    Q3 margins should be up.

    by inside_trades Aug 19, 2015 4:46 PM
    johnwrandall johnwrandall Aug 20, 2015 2:10 PM Flag

    I suspect originations are roughly the same as Q2, but margins should be better than Q2 as rates have been decreasing. All that said, still 1 1/3 months left this quarter.

    The key is the positive cash flow. IMH has a net cash cow for the forseeable future in CCM, and additional values that come from being a bigger seller/borrower/servicer.

    This 15 handle on pps is ridiculous. If the company merely double the first half in operating profit, the PE on operating profit would be less than 3. Price should be high 20s.

    Sentiment: Strong Buy

  • Reply to

    Pickups Buying

    by zekegern Aug 11, 2015 10:16 PM
    johnwrandall johnwrandall Aug 11, 2015 11:13 PM Flag

    To echo a previous post from someone, the shorts will ultimately lose to the Pickups.

    And further support of the financial strength of IMH - CFO says CashCall's 65% for Q2 was about $8m. So, net retained by IMH for the 35% would be about $4m. With $10m in cash paid out in Jan 2015, that is a mere FORTY PERCENT (40%) ROI in the second quarter alone!!

    Question should really be what is the appropriate multiple to apply to the next 12 months EPS?

  • Reply to

    Thoughts on results?

    by magalo555 Aug 6, 2015 6:31 PM
    johnwrandall johnwrandall Aug 6, 2015 7:30 PM Flag

    Originations increased, revenue increased, servicing portfolio increased, and now 2 consecutive quarters totaling $33m in pre-tax profits!!!! Pretty disappointing, time to short this thing LOL.

  • johnwrandall by johnwrandall Aug 6, 2015 12:04 PM Flag

    Originations are up $400m in Q2 (about 17% from Q1), and IMH gets 3 months of CCM net earnings (instead of 1 month in Q1).

    There would have to be a horrendous drop in average basis points for the gain on sale, along with an increase in operating costs, in order for Net Income before Income Tax to decrease from the $10m in Q1.

    Pretty unlikely this quarter's Net Income (before tax) is lower than Q1, which should translate into a solid mid 20s stock price.

  • Reply to

    Short Interest

    by kngpn_2000 Jul 30, 2015 7:28 PM
    johnwrandall johnwrandall Jul 31, 2015 1:10 AM Flag

    Short interest is up, and stock is up 10% today. Not going to be good to be shorting this when earnings come out.

  • Reply to

    Anyone care to take an educated guess

    by directexpresscourier Jul 21, 2015 9:16 PM
    johnwrandall johnwrandall Jul 21, 2015 10:02 PM Flag

    CEO says operating profit of $17m in Q2 during the meeting. Operating profit for Q1 and Q2 would total about $28m. Income tax effect is accretive during 2015, given all the loss carryforwards. Doubling the first half would be $56m full year. With a multiple of only 6, the stock should trade in the mid 30s.

    Either way, this will be more enjoyable when the short sellers get out, and the institutions get in.

    Sentiment: Strong Buy

  • Reply to

    Q2

    by repn314 Jul 21, 2015 12:59 PM
    johnwrandall johnwrandall Jul 21, 2015 3:10 PM Flag

    What makes Q3 sluggish when pending homes sales are increasing?

    The Q2 operating profit was mentioned at $17-18 million, that's an increase of about 70% from the previous 90 days. That is very bullish!

  • Reply to

    Just to be the voice of reason.

    by inside_trades Jun 5, 2015 4:15 PM
    johnwrandall johnwrandall Jun 6, 2015 10:36 PM Flag

    In response to both replies....

    inside_trades: From the Q1 filing:

    Changes in fair value (1) (3,094,000)

    If $3m+ in Q1 is a grain of sand, then I guess I should revisit the amount I will need to retire....

    An additional point on rates and MSRs - an increase in rates will provide double value. Both an increase in revenue to make up for previous downward adjustments, but an increase beyond the previous watermark as those loans are significantly less likely to be paid off.

    Good question regarding CCM net profits from new states.... first, any one of the covering analyst should have already asked this, to confirm for their forecasts. But, my crystal ball says all states are included. But that's fine - everybody wins when CCM expands geographically - borrowers, CCM, IMH. Only losers are the other originators who see their volume drop.

  • Reply to

    Just to be the voice of reason.

    by inside_trades Jun 5, 2015 4:15 PM
    johnwrandall johnwrandall Jun 5, 2015 6:08 PM Flag

    There are a cross competing forces to IMH's origination levels, and while higher rates would lead to lower volume, opening more states to origination in an improving economy will lead to higher volume.

    On top of that, CCM profit share dropped from 100% in Jan & Feb to 65% in March. IMH will keep 35% of net profits for all of Q2 (unlike only 35% of net profits in 1 month in Q1).

    Did I mention the MSR value will get a nice bump higher when rates increase.

    The sum of all this is the IMH train has tremendous momentum, and rates will have to go very high to slow it down enough to justify the stock trading under $25.

    Sentiment: Strong Buy

  • Reply to

    Alot of Volume before 10:00 AM

    by gulfcoastjoe Jun 3, 2015 10:17 AM
    johnwrandall johnwrandall Jun 4, 2015 12:10 AM Flag

    Folks - rising rates are not the end of the world. In fact, rising rates get some borrowers off the fence. Refi volume may slow down, but as high prices and higher loan amounts equate to better margins on lower volume. The offsetting factors are plentiful when a machine nets pre-tax of $10m in a 90 day period.

    Even if rates have a 5 handle, what happens - IMH only does $2.2b in quarterly volume because by then they are originating in twice as many states?

    My $ says this stock is at $25+ by end of 2015, and $40+ by end of 2016. That's still under $500m in market cap. Watch and enjoy the roller coaster ride!

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