Altisource Portfolio Solutions (ASPS) is in the real estate services business. If you own a company that owns real estate, does real estate transactions, or or works with foreclosures, you call Altisource and “outsource” some of your workload.
I almost bought ASPS at $40 a year ago. Now the stock’s $90, and its been almost-bought by me numerous times. This is one of my biggest misses in 2011-2012. But now the stock isn’t undervalued anymore.
One Year Chart
In the one-year chart it’s easy to see why ASPS is up — quarterly profits (the four numbers on the bottom-left) have brown an average of 86% a quarter.
What’s not-so-great is the stock’s P/E of 19. Sure 19 times earnings is reasonable, but last year the P/E was 12. With an estimated Long Term Growth Rate of 20% ASPS was on sale when it was selling for 12 times earnings. Now with a P/E of 19 it’s not.
Fair Value
With a P/E of 19, ASPS is selling close to its Fair Value P/E of 20. A year ago I thought the stock should double. Now it has.
Sharek’s Take
Although things are going great now, there’s little certainty as to ASPS’s numbers. In my past reasearch I discovered the company missed estimates big-time before going on this recent run. I also like to know what I own and can’t get a firm grasp on how ASPS makes money. Does it make more when the economy is poor because of foreclosures? Is it better when the economy is good because there’s more titles being issued? This isn’t a regular growth stock like we normally own.
I’ll keep ASPS at the top of my radar, and will look to get in around $75.
View the Earnings Table here.View the Ten Year Chart here.
