UPDATE: Deutsche Bank Upgrades Home Loan Servicing to Buy on Dividend Increase
Deutsche Bank raised its rating on Home Loan Servicing (NASDAQ: HLSS) from Hold to Buy with a reiterated $19.25 price target.
Deutsche Bank commented, "We are upgrading HLSS to a Buy from a Hold given the div increase (12c/mo from 11c/mo) and our expectation of stable ROEs. Prepayment speeds on subprime loans, which HLSS targets, are less sensitive to prepayments, and advances have virtually no credit risk since they are senior to AAA cash flows. We believe the recent pullback, caused by high yield stocks coming under pressure, has created an attractive buying opportunity for HLSS."
Home Loan Servicing closed at $17.67 on Thursday.
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