LENDER PROCESSING (LPS, Financial) filed Quarterly Report for the period ended 2010-06-30.
Lender Processing has a market cap of $3.03 billion; its shares were traded at around $31.94 with a P/E ratio of 9.56 and P/S ratio of 1.28. The dividend yield of Lender Processing stocks is 1.25%.LPS is in the portfolios of Murray Stahl of Horizon Asset Management, Ronald Muhlenkamp of Muhlenkamp Fund, Lee Ainslie of Maverick Capital, Westport Asset Management, Paul Tudor Jones of The Tudor Group, John Keeley of Keeley Fund Management, Jim Simons of Renaissance Technologies LLC, Steven Cohen of SAC Capital Advisors, Bruce Kovner of Caxton Associates, George Soros of Soros Fund Management LLC.
We have approximately $1,286.8 million in long-term debt outstanding as of June 30, 2010, of which approximately $1,007.0 million bears interest at a fixed rate ($640.0 million through interest rate swaps), while the remaining portion bears interest at a floating rate. As a result of our current level of debt, we are highly leveraged and subject to risk from changes in interest rates. Having this amount of debt also makes us more susceptible to negative economic changes, as a large portion of our cash is committed to servicing our debt. Therefore, in a bad economy or if interest rates rise, it may be harder for us to attract executive talent, invest in acquisitions or new ventures, or develop new services.
Gross profit was $208.2 million and $209.2 million during the second quarter of 2010 and 2009, respectively. Gross profit as a percentage of processing and services revenues (gross margin) was 34.8% and 34.1% during the second quarter of 2010 and 2009, respectively. The increase in gross margin during the second quarter of 2010 when compared to the second quarter of 2009 was a result of the factors described above.
Other income and expense, which consists of interest income, interest expense and other items, was $18.2 million and $21.2 million during the second quarter of 2010 and 2009, respectively. The decrease during the current year quarter was primarily due to a reduction in interest expense, which totaled $18.6 million and $21.6 million during the second quarter of 2010 and 2009, respectively, resulting from lower interest rates and principal balances.
Net earnings were $80.4 million and $75.3 million during the second quarter of 2010 and 2009, respectively. Net earnings per diluted share totaled $0.85 and $0.78 during the second quarter of 2010 and 2009, respectively. The increase during the second quarter of 2010 when compared to the second quarter of 2009 was a result of the factors described above.
Gross profit was $84.9 million and $73.0 million during the second quarter of 2010 and 2009, respectively. Gross margin was 45.8% and 42.5% during the second quarter of 2010 and 2009, respectively. The increase in gross margin during the second quarter of 2010 when compared to the second quarter of 2009 was a result of the factors described above.
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Lender Processing has a market cap of $3.03 billion; its shares were traded at around $31.94 with a P/E ratio of 9.56 and P/S ratio of 1.28. The dividend yield of Lender Processing stocks is 1.25%.LPS is in the portfolios of Murray Stahl of Horizon Asset Management, Ronald Muhlenkamp of Muhlenkamp Fund, Lee Ainslie of Maverick Capital, Westport Asset Management, Paul Tudor Jones of The Tudor Group, John Keeley of Keeley Fund Management, Jim Simons of Renaissance Technologies LLC, Steven Cohen of SAC Capital Advisors, Bruce Kovner of Caxton Associates, George Soros of Soros Fund Management LLC.
Highlight of Business Operations:
According to the Mortgage Bankers Associations (MBA) current Mortgage Finance Forecast, U.S. mortgage originations (including refinancing) were approximately $2.1 trillion and $1.5 trillion in 2009 and 2008, respectively. The MBAs Mortgage Finance Forecast currently estimates an approximately $1.5 trillion mortgage origination market for 2010. The MBA further forecasts that this decrease will result primarily from less refinancing activity. The MBA estimates that loan origination volumes in the first six months of 2010 were approximately 18% lower than the first six months of 2009.We have approximately $1,286.8 million in long-term debt outstanding as of June 30, 2010, of which approximately $1,007.0 million bears interest at a fixed rate ($640.0 million through interest rate swaps), while the remaining portion bears interest at a floating rate. As a result of our current level of debt, we are highly leveraged and subject to risk from changes in interest rates. Having this amount of debt also makes us more susceptible to negative economic changes, as a large portion of our cash is committed to servicing our debt. Therefore, in a bad economy or if interest rates rise, it may be harder for us to attract executive talent, invest in acquisitions or new ventures, or develop new services.
Gross profit was $208.2 million and $209.2 million during the second quarter of 2010 and 2009, respectively. Gross profit as a percentage of processing and services revenues (gross margin) was 34.8% and 34.1% during the second quarter of 2010 and 2009, respectively. The increase in gross margin during the second quarter of 2010 when compared to the second quarter of 2009 was a result of the factors described above.
Other income and expense, which consists of interest income, interest expense and other items, was $18.2 million and $21.2 million during the second quarter of 2010 and 2009, respectively. The decrease during the current year quarter was primarily due to a reduction in interest expense, which totaled $18.6 million and $21.6 million during the second quarter of 2010 and 2009, respectively, resulting from lower interest rates and principal balances.
Net earnings were $80.4 million and $75.3 million during the second quarter of 2010 and 2009, respectively. Net earnings per diluted share totaled $0.85 and $0.78 during the second quarter of 2010 and 2009, respectively. The increase during the second quarter of 2010 when compared to the second quarter of 2009 was a result of the factors described above.
Gross profit was $84.9 million and $73.0 million during the second quarter of 2010 and 2009, respectively. Gross margin was 45.8% and 42.5% during the second quarter of 2010 and 2009, respectively. The increase in gross margin during the second quarter of 2010 when compared to the second quarter of 2009 was a result of the factors described above.
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