LAFDI market report - Friday 1st May

By Rupert Taylor on Friday 1 May 2015

Alternative Lending

The Liberum AltFi Financial Disruptors Index delivered a solid week of out-performance besting the wider market by just shy of 2%.    .  

 

Weekly return

LAFDI

1.18%

MSCI World

-0.71%

Top 5 performing Stocks in last week

1

OPAY LN Equity

15.80%

2

CACC US Equity

11.95%

3

RM US Equity

9.42%

4

XOOM US Equity

8.27%

5

PFSI US Equity

7.21%

Worst 5 performing Stocks in last week

1

TREE US Equity

-9.39%

2

ONDK US Equity

-9.11%

3

LC US Equity

-7.33%

4

NEWS US Equity

-4.96%

5

SGM US Equity

-4.53%

  * Returns are calculated for the week to local market close on Thursday

Two of the index heavy-weights lead the way with both Optimal Payments Plc and Credit Acceptance Corp delivering double digit returns.

Optimal Payments Plc rallied a short 16% over the week.  The online money transfer service stock started the week on the front foot after reiterations of buy recommendations from both Numis and BarCap.  This support may have been supplemented by as yet un-confirmed theories relating to potential consolidation in this particular fin-tech niche.

Credit Acceptance Corp continued its strong recent run with a consensus beating set of first quarter results.  The company reported $3.44 EPS for the quarter, beating the Thomson Reuters consensus estimate of $3.33 by $0.11. The shares where trading at just below $140 at the start of the year versus a close last night of $236.2.  Credit Acceptance Corporation provides funding, receivables management, collection, sales training, and related services to automobile dealers. The Company also provides indirect financing for buyers with limited access to traditional sources of consumer credit.

Regional Management Corp offers consumer finance services. The Company extends credit primarily to people who have limited access to consumer credit from banks, savings and loans, credit card companies and other traditional lenders.  After publishing impressive results on Tuesday, showing total delinquencies as percentage of receivables at the lowest level since their IPO, the shares moved ahead taking them back towards the highs of the year at around $16.  However the shares still remain far below the highs of around $36 reached in early 2014. 

There was a similar amount of action on the fallers side of the index.  The residential real-estate lending company Lending Tree Inc fell 10.88% on Thursday with no obvious news behind the move. 

Close behind with significant declines were the two big, recently IPO’ed, alternative finance names Lending Club and On Deck Capital Inc.  Whilst there were no obvious company specific news items it was reported last week that Lending Club has been the recipient of a large growth in short interest of late.  As of March 31st, there was short interest totalling 24,988,845 shares, a growth of 25.2% from the March 13th total of 19,958,984 shares, AnalystRatingsNetwork reports. Based on an average trading volume of 2,286,003 shares, the short-interest ratio is currently 10.9 days. Approximately 16.6% of the company’s stock are short sold. Making LC the sixth most shorted (or least favoured) stock on the NYSE.

Please note : The LAFDI is now available on Bloomberg.  Tickers:

LAFDITR Index <GO> for the Total Return Index

LAFDIPR Index <GO> for the Price Return Index

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Companies in this Article:

LendingClub