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Sally Jones
Sally Jones
Articles (580) 

From The Land of What If - Smart Proteins and Debt Collectors

September 28, 2013 | About:

Today’s diverse companies were chosen for their speculative enterprises. Both companies deal in the territory of what if. If Encore Capital Group Inc. (NASDAQ:ECPG) can collect more from a huge portfolio of consumer debt, the company would grow. If Sophiris Bio Inc. (NASDAQ:SPHS), a 10-person biopharm, is successful in competing to provide relief for prostate BPH symptoms, the company would soar.

Sophiris Bio Inc. (NASDAQ:SPHS)

The SPHS share price is currently $4.37 or 85.6% off the 52-week high of $30.32. Its yield is 0.00%.

Up 2,426% over 12 months, Sophiris Bio Inc. has a market cap of $75.57 million and entries value of $71.58 million. Shares trade at a P/S of 2.98. The company is way up from its August IPO.

Formed in 2003, Sophiris Bio Inc. is a clinical-stage biopharmaceutical company that develops and commercializes products for the treatment of urological diseases. The company is currently developing PRX302 for the treatment of benign prostatic hyperplasia, or BPH, a non-cancerous enlargement of the prostate gland.

The company’s product “PRX302” is a recombinant form of a protein that is highly targeted to prostate tissue. According to the company, the protein is smart: “Once activated, PRX302 forms disruptive pores in the membranes of prostate cells resulting in selective cell death, thus creating a highly targeted, localized approach to killing prostate cells constricting the urethra.”

The company reported that it raised $65 million in its August IPO, selling 13 million shares for $5 per share. Insiders made four buys of SPHS stock.

For the second quarter ended June 30, 2013, the company reported a net loss of $2.6 million, compared to a net loss of $5.7 million for the same period in 2012. The earnings per share for the most recent quarter were ($0.02) per share, compared to ($0.03) per share for the same quarter in 2012. Sophiris Bio spent $1.2 million in the second quarter of 2013 for research and development, much less than in the same period a year ago at $3.7 million.

Guru Action: No gurus currently hold shares but there is insider trading.

Tracking share price, revenue and net income:


Encore Capital Group Inc. (NASDAQ:ECPG)

Up 58% over 12 months, Encore Capital Group Inc. has a market cap of $1.15 billion and an enterprise value of $2.04 billion. Shares trade with a P/E of 16.10 and a P/B of 2.30.

The ECPG share price is currently $45.59.

Incorporated in 1999, Encore Capital Group Inc. is a debt management and recovery solutions company, headquartered in San Diego. Encore Capital Group purchases portfolios of defaulted consumer receivables at deep discounts to face value and manages them by partnering with individuals as they repay their obligations and work towards financial recovery.

In June Encore Capital Group acquired Asset Acceptance Capital Corporation for around $200 million or $6.50 per share. At the time of the acquisition announcement, Asset Acceptance had $1 billion in estimated remaining collections. The acquisition included all operating subsidiaries of Asset Acceptance. After the acquisition, Encore has over 60 million individual consumer accounts, representing a face value of over $130 billion.

The company reported financial results for the second quarter of 2013 with $152 million in revenue, compared to $138.7 million in the same quarter a year ago. The company’s gross collections were up 16% over last year in the same quarter, at $278.4 million compared to $240.6 in the second quarter of 2012.

Guru Action: Jim Simons is the sole Guru stakeholder, and there is insider trading.

As of June 30, 2013, long-time stakeholder, Jim Simons made a new buy of 108,409 shares at an average price of $31.92 for a gain of 42.8%. Check out his remarkable five-year history showing solid gains and no losses:


Tracking share price, revenue and net income since 1999:



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About the author:

Sally Jones
Sally Jones writes about Real Time Picks. She says, "I truly enjoy watching the Gurus in realtime and telling their story."

Rating: 5.0/5 (1 vote)


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GuruFocus has detected 8 Warning Signs with Encore Capital Group Inc $ECPG.
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