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Novation Companies, Inc. Message Board

wellsbay 2 posts  |  Last Activity: Mar 21, 2016 9:37 AM Member since: Feb 2, 2012
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  • From the latest Eberwein bio:

    As Chairman of the Board of Digirad Corporation, he helped orchestrate a complete turnaround which restored the company to profitability and has overseen multiple accretive acquisitions; he also bought back stock and started paying a dividend; their stock price is up 186% during Eberwein’s tenure on its board.

    Eberwein also joined the board of NTS in December 2012 and in less than a year led the Special Committee in a sale of the company to private equity firm for $2/share, reflecting a 122% return.

    As Chairman of AMERI Holdings, he has overseen value-enhancing acquisitions along with an approximate 333% stock price return in 10 months.

    At Eberwein’s purchase price of 30 cents, NOVC would need a dramatic rise in share price to meet this kind of track record. The only way to accomplish it is to make a deal with debt holders (and they are said to be working on that), take on more debt to buy one or more profitable companies and set out a plan to utilize the hundreds of millions in NOLs on the company’s books.

  • Assurant, in their annual report this week and earnings call yesterday, is praising growth from its Mortgage Solutions segment that is largely made up of Streetlinks. This is significant to NOVC shareholders, since a bonus up to $10.5M can be earned if revenue targets are met in 2016. That translates to the equivalent of the entire current value the market is placing on NOVC shares.

    Assurant has not provided specific figures for Streetlinks, which must have annual revenues of $184M to earn the full bonus. A sliding scale bonus also can be achieved starting at $167M.

    In 2015, Assurant reports it gained $40M more in fees from its Mortgage Solutions business, of which Streetlinks appears to account for 55-60% of its revenue. Assurant earlier claimed 20% growth in this segment, but for the entire year, it now appears that 16% was the final number. Applied to Streetlinks, which did $144M in the year before its sale, that would bring it up to about $167M for 2015. A smaller increase in 2016 would earn the full bonus.

    And, Assurant keeps talking about growing market share, despite any ups and downs in the mortgage origination market.

    Assurant: Currently, we provide valuation or property preservation services to seven of the top 10 servicers and five of the top 10 mortgage originators. We believe there are a significant opportunities to cross-sell additional offerings and grow with existing and new clients. In the year ahead, we will continue to invest in mortgage solutions as targeted areas for growth.

    On March 8, Assurant has promised even more details at its Investor Day when it says it will talk about more specific targets in the key growth areas of the company, which includes its Mortgage Solutions.

    In the meantime, we await the plan from Eberwein and Gillman, who are the Board’s investment committee on how they plan to tap into the hundreds of millions of dollars in tax savings available through the company’s accumulated tax losses.

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