Came onto my radar screen following their first doubling of Lease Book to 60M when they purchased Cars on Credit and now taking out their largest competitor and getting Todd Hudson to take this project on full time as CEO of a 50M market cap company after running a multi billion dollar finance company is clearly a sign he sees something here.
 
Where is This Business Standing Today
 
A Lease Receivable book of 110M that generates a return of 30-35% that creates a revenue run rate of 33.0 – 38.5M excluding any incremental acquisitions from the notorious Canadian deal man that is now running the show.  
 
On a cost side assuming an Operating income margin of 50% which I think will be conservative given the ACL that are well under control in the 6-8% range and 2M in quarterly General and Admin costs that leaves 10M in income or about 0.10 EPS when I use a 100M share count number.
 
Valuing Axis Finance Based off Carfinco Acquisition
 
When Carfinco got taken out a couple years back general market asset prices and multiples were much lower so using those terms is a conservative benchmark today to start at looking for a valuation target.
 
Cafinco got bought out for 300M or 11.25/share (14-15x P/E with a Lease Book of 270M or 1-1.5x Lease Assets).
 
Applying to AXIS.V
 
With a 110M Lease Asset Portfolio and 10M in income on these metrices I get to a target price of  1.10-1.65/share on Lease Assets or 1.40 – 1.50/share on P/E so lets blend the two metrics for 1.41/share or exactly 100% upside.
 
 
Interesting non-bank Canadian financial that I think will get bought out before the end of the economic cycle by a major tier 1 bank or a larger alternative lender
 
Bringing on Todd Hudson full time as the CEO is the game changer, one of the great Canadian financier with many relationships he can draw on from his Element Capital days and I think he eventually sells the company.
 
ON THE RADAR