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PHH locks in retail mortgage opportunities

Opens six new retail centers

PHH Mortgage (PHH) opened six new retail mortgage centers across the nation, fulfilling the company’s recent focus on expanding its brick and mortar locations.

Late last year offices were opened in Dallas and Houston, and since January, additional offices have been opened in Los Angeles, Boston and Orlando.

"The opening of these offices represents the company's first steps executing against our new retail expansion strategy," said Ralph Melbourne, senior vice president of Real Estate.

"The establishment of a retail presence in select markets around the country operating under the PHH Mortgage name will help to diversify our revenue base, broaden our market reach and complement our existing business. We are excited about the opportunity to provide mortgage assistance to new and existing homeowners in these markets," Melbourne added.

In the company’s latest earnings release, it reported a net loss from continuing operations of $191 million, or $3.47 per basic share, in 2014. It was a sharp reversal from PHH’s performance in 2013 when the company reported a net income of $69 million from continuing operations.

Originations fell 5% over third-quarter 2014, while lock volumes declined 13%, resulting in lower origination-related revenues.

But despite the drop in originations, FBR Capital Markets and Company gave the company a strong forecast in its company report.

FBR reiterated its outperform rating and $28 price target on shares of PHH Corporation following the company's 4Q14 earnings release. The company is expected to return to profitability as its restructuring plan kicks in. Following the fourth quarter earnings, FBR adjusted its FY15 EPS estimate to ($0.18) from ($0.15) and maintained its FY16 EPS estimate of $2.00.

“We continue to believe that the success of management's restructuring initiatives will be key in determining the future profitability of the company, especially as management has already guided to negative core earnings through mid 2015,” Miller said. 

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