HW 30 rises, servicer stocks take a tumble
Ocwen earnings show the servicer is profitable, but outside its target
The HW 30 finished up Friday, despite numerous mortgage-related stocks taking a hit, including the mega servicers, which fell alongside Ocwen Financial Corp. (OCN) as the firm missed certain goals in its third-quarter earnings.
HW rose 0.14% Friday, following the Dow Jones Industrial Average, Nasdaq and S&P 500 higher.
Ocwen’s stock fell more than 5% Friday a day after the company reported a solid profit and revenue, but admitted its historic margins have been suppressed by loan transfers as the company focuses on ensuring the boarding process is seamless.
Ocwen posted a profit of $67 million, or 44 cents a share, in the third quarter. That is up from $51.4 million, or 37 cents a share, from 2Q of 2012. The company’s revenue also grew 128% from last year.
But having to board loans, particularly those from OneWest, pulled a little wind out of the firm’s margins.
On this news, Ocwen’s stock remained low Friday. Oddly enough, the firms that most resemble Ocwen in terms of their business and exposure to servicing changes – Walter Investment Management Corp. (WAC) and Nationstar (NSM) also took a hit on the HW 30, with both stocks falling.
Walter Investment Management fell 3.59%, while Nationstar’s stock declined 1.58% in Friday trading.