PHH shares have room to run: Barron's
NEW YORK (Reuters) - Investors looking for a play on U.S. housing should take a look at mortgage-lending and car-leasing company PHH (PHH.N), business weekly Barron's said on Sunday.
PHH's mortgage-lending business, previously a source of financial concern, is in turnaround mode and a reason for "recent optimism," according to Barron's.
PHH's stock is back up around $21, after falling to $10 in December, but it has further to run, the weekly newspaper said.
CEO Glen Messina, who has been at the helm since January, has tightened the mortgage operations, helping to ease the liquidity concerns that hurt the company earlier in the year, Barron's reported.
"PHH offers an ideal end-to-end solution as a top-tier mortgage player that originates, funds, closes, and services mortgages," Barron's said.
PHH's "blue-chip clientele" includes Morgan Stanley, Merrill Lynch, First Horizon, and beginning next year, the U.S. arm of HSBC, according to Barron's.
Henry Coffee of Sterne Agee and Paul Miller of FBR have one-year target prices on the stock of $26 and $25 respectively, Barron's said. It also quoted one anonymous "sophisticated investor" who expects a private equity firm "to sweep in the next year or so and take PHH out north of $30."
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