Accord Financial Corp T.ACD.DB

book value

[theanalyst11]

of 11.56$
\
cheap!!

[MaxCdn]

Yes.... and a nice P/E of only 6.95.  Dividend yield of 4.14% and ROE of 11.8% Aside the size of this company (baby cap of only $73 M ), there is nothing not to like. 

[Method]

  I own this and TII.V in the lending space. Similar P/E and dividend yield but TII has a lower P/B and ROE. ROE is starting to trend up though so we'll probably seem some multiple expansion. Tii also has lower net leverage but both are way undervalued. CHW has already bounced back in a big way off the lows but ACD and TII should follow.

[janeintoronto]

A premium or discount (which Accord's market price is) to book is not that relevant in a financial company. Financials are typically so leveraged that even if they sell at 50% of book, that may only equate to 5% discount on assets. Like many small financials, ACD may be a takeover target, but other than that influence, I don't expect the market to suddenly say, oh, wow, this is undervalued

[Method]

i wholeheartedly disagree. Book value is probably most relevant for financial companies as their assets are often marked to market. This makes book value a reasonable proxy for liquidation value. The leverage is already deducted from the assets to determine the book value so it reads like you are double counting. Good luck in your investments. 

[mjh9413]

The trouble I have with factoring is just how darn expensive it is for companies who have to avail themselves of this type of receivables financing. I would not invest out of principle, but that's just me.

[Method]

  Yet we probably have a lower ROE than the companies whose AR we are factoring. Weird choice to prefer our customers to make less money instead of helping with their liquidity.