|Bid||0.00 x 0|
|Ask||0.00 x 0|
|Day's Range||24.14 - 25.76|
|52 Week Range||9.87 - 25.76|
|Beta (3Y Monthly)||1.43|
|PE Ratio (TTM)||20.97|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||N/A|
(Bloomberg) -- It took two years, but Home Capital Group Inc. shares have regained all their lost ground since the Canadian alternative mortgage lender almost collapsed in 2017.Home Capital has more than doubled this year to become the fourth-best performing stock on Canada’s benchmark S&P/TSX Composite Index. The stock surged as much as 14% on Wednesday, the most in a year, after the Toronto-based lender reported third-quarter profit on Wednesday that beat the highest analyst estimate and said it plans to buy back C$150 million ($113 million) worth of shares. The run up has taken the stock to levels last seen in July 2016, seven months before plunging after Ontario’s securities regulator accused the company of misleading shareholders over falsified mortgage applications.Alternative lenders including Home Capital and Equitable Group Inc. have seen their stocks surge this year as the pace of mortgage growth picked up during the spring home-buying season, and home sales recovered in major cities including Toronto and Vancouver.The “significant” share price appreciation of the alternative lenders is reflective of improving housing conditions -- particularly in Greater Toronto -- as well as a benign credit environment and robust mortgage growth outlook, CIBC analyst Marco Giurleo said in a Nov. 1 note to clients. He upgraded Home Capital to “outperformer” based on the company’s “path to double-digit profitability”, a strong mortgage growth outlook and attractive valuation.Home Capital’s stock went into a free-fall in the weeks after the regulator’s allegations, fueled by short-selling and a run on deposits. Shares sunk to as low as C$5.85 in May that year, before Warren Buffett stepped in to buy a 38% stake in Home Capital and backstopped the lender with a C$2 billion ($1.5 billion) credit line through Berkshire Hathaway Inc.Berkshire has since cashed in as the stock has recovered. The shares jumped 12% to C$32.62 at 9:46 a.m. in Toronto, for a market value of C$1.9 billion.Home Capital posted third-quarter profit of C$39 million, or 67 cents a share, up 20% from a year ago. Adjusted earnings were 72 cents a share, topping the 58-cents-a-share average estimate of analysts’ surveyed by Bloomberg.While Home Capital’s shares have recovered, the lender’s assets haven’t quite reached their pre-crisis levels. The company had C$18.9 billion of assets in the third quarter, down from a peak of C$21 billion at the beginning of 2017.(Updates with share price in second paragraph.)To contact the reporter on this story: Doug Alexander in Toronto at firstname.lastname@example.orgTo contact the editors responsible for this story: Michael J. Moore at email@example.com, ;David Scanlan at firstname.lastname@example.org, Jacqueline ThorpeFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
If you own shares in Home Capital Group Inc. (TSE:HCG) then it's worth thinking about how it contributes to the...
Warren Buffett (Trades, Portfolio), CEO of Berkshire Hathaway (NYSE:BRK.A)(NYSE:BRK.B), said he would "substantially exit" from his position in Canadian mortgage lender Home Capital Group Inc. (HCG.TO), about a year and a half after starting the investment. Warning! GuruFocus has detected 3 Warning Signs with TSX:HCG. The investment also entailed a purchase of 16.04 million shares, or a 19.99% stake in the company for a cumulative price of $153.23 million.
Billionaire investor Warren Buffett is cutting ties with a Canadian mortgage business after a nifty trade that provided the company with a potential lifeline. Buffett's Berkshire Hathaway Inc (BRKa.N) is "substantially" exiting its stake in Home Capital Group Inc (HCG.TO) after selling shares back to the company, the Canadian mortgage lender and Buffett said on Wednesday. Shares of Home Capital tumbled as much as 19 percent in early trading before paring losses to trade down 13.2 percent to C$14.30 at midday.
shares were falling hard Wednesday after Warren Buffett's Berkshire Hathaway Inc. said it was selling a substantial portion of its stake. Berkshire Hathaway will "substantially exit" its stake in the company - it currently holds 24.64% of the outstanding shares, according to FactSet.