I'm long ESI at $8.12 but this is a strange upgrade.
1) Wells Fargo already was already positive on ESI with a substantial upside target.
2) Assets sales are restricted by the banks. ESI is securing its letters of credit and other obligations with its assets. They can't be sold anytime soon.
3) Even if ESI wanted to sell assets, it wouldn't increase its book value. They would just trade assets for cash.
4) With $200 million in cash, ESI already has enough cash for all its corporate funding.
5) The CFPB lawsuit may get thrown out. That's what I expect. In any case, the lawsuit won't be settled for a long time and if there is a settlement, the settlement shouldn't be too onerous. Maybe $20 to $30 million tops.
"Over the past several weeks, more than 20K oil workers have lost their jobs as companies pare their workforces to deal with the drop in oil prices. More than 700 oil industry jobs are now being terminated in Texas, following recent lay off announcements. GE (NYSE:GE) is planning to cut 45% of staff at its Buck Creek plant, SandRidge Energy's (NYSE:SD) subsidiary Lariat Services is looking to slash jobs in the Permian Basin, and Trican Well Service (OTCPK:TOLWF) is shutting down its operation in Longview, Texas."