UPDATE: Piper Jaffray Reiterates Overweight Rating, Raises PT on Ocwen Financial Corporation

In a report published Friday, Piper Jaffray & Co. reiterated its Overweight rating on Ocwen Financial Corporation

, and raised its price target from $44.00 to $47.00. Piper Jaffray noted, “OCN reported strong 3Q results with revenue of $232.7M vs. PJC at $226.8M. Core EPS of $0.37 was below our $0.44 estimate. Servicing fees grew 89% Y/Y on higher avg UPB of ~$127B vs. $76.5B in 3Q11. Operating margin was 60.1%. OCN boarded a total of $6.1B of UPB during 3Q12, including $3.6B of delinquent flow subservicing. On the call, OCN stated its tax rate should fall to ~10% during 4Q12. OCN noted Homeward and ResCap should generate low-20% pre-tax returns. The pipeline remains robust at $350B and flow deals are very profitable. All in, we believe 3Q12 represented continued evidence of OCN's ability to board loans and drive operating efficiencies. We reiterate our OW rating and raise our PT to $47 based on 10.0x our new 2013E core EPS of $4.72.” Ocwen Financial Corporation closed on Thursday at $35.60.