Bullboard - Stock Discussion Forum ECN Capital Corp T.ECN.PR.C

Primary Symbol: T.ECN Alternate Symbol(s): T.ECN.DB | T.ECN.DB.A | T.ECN.DB.B | ECNCF | ECNNF

ECN Capital Corp. is a Canada-based company. The Company is a provider of business services to North American banks, credit unions, life insurance companies, pension funds and institutional investors (collectively, its Partners). It originates, manages and advises on credit assets on behalf of its Partners, specifically consumer (manufactured housing and recreational vehicle and marine) loans... see more

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TSX:ECN - Post Discussion

ECN Capital Corp > CIBC

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Post by retiredcf on Dec 07, 2021 8:55am

CIBC

EQUITY RESEARCH
December 6, 2021 Earnings Update
ECN CAPITAL CORP.

Resuming Coverage Following The Sale Of Service Finance
Our Conclusion

We are resuming coverage of ECN Capital following a period of research restriction related to the sale of the company’s largest operating subsidiary, Service Finance Company (“SFC”), to Truist Bank. We believe that the divestiture was partly motivated by a changing competitive landscape in the home improvement consumer loan space. The exit represented a 6.5x multiple of capital in just over four years. We believe that the market-implied value of the stub appears reasonably conservative, and that the company has lined up a solid growth outlook for 2022 and beyond. We are reiterating our Outperformer rating and revising our price target to C$6 (which,
combined with the $7.50 special dividend, reflects a total return of ~20%).

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