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Kerrisdale Capital, a private
investment management firm, has published its investment thesis explaining why
it owns shares of JGWPT Holdings Inc.
, the nation's leading
purchaser of structured settlements and the owner of the J.G. Wentworth and
Peachtree brands. Kerrisdale believes that shares of JGW offer new investors
more than 75% upside given continued organic growth, accretive acquisition
opportunities, and a forward valuation multiple of just 7x earnings.
The full report can be found here: http://kerr.co/jgw
JGW has 60-70% market share and unrivaled brand recognition in the structured
settlement sector. JGW's towering scale and access to the securitization
markets provide it with a lower cost of capital, and more competitive pricing,
than any of its current competitors. To further bolster its growth, JGW is
exploring the acquisition of several smaller competitors, an approach
Kerrisdale believes can drive superior returns on capital.
Kerrisdale believes that a reasonable fair value for JGW, without attributed
upside for M&A and adjacent market opportunities, is materially higher than
the current stock price.
"While new to the public markets, J.G. Wentworth and Peachtree are brand names
with national significance and a long-term track record of success. Poor
initial trading and a confusing accounting structure have led many to neglect
this well-managed highly profitable business," said Sahm Adrangi, Chief
Investment Officer of Kerrisdale Capital.
Kerrisdale currently holds long positions in JGW.
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