PSMH: Fourth Quarter Better than Expected
By Ann Heffron, CFA
PSM Holdings, Inc. (
posted a net loss of $0.3 million, or a loss per share of $0.01,
for 2012's fiscal fourth quarter, ending June 30, 2012. This
compares to a fiscal third quarter (ending March 31, 2012) net
loss of $1.4 million, or a loss per share of $0.05. Both quarters
reflected the adoption of PSMH's new business model, including
all five acquisitions the Company has made to date.
The fourth quarter was above our EPS estimate of a $0.02 net
loss per share as revenues of $5.0 million were $1.0 million, or
24%, higher than our $4.0 million estimate due to
better-than-expected loan origination volume and gross profit
Total operating expenses were $5.3 million versus our $4.6
million estimate, with the overage largely reflecting increased
variable compensation costs stemming from higher loan
We have raised our estimates, as we have increased our
projections for loan origination volume and the gross profit
margin. Our new estimate for the 2013 fiscal year ending June 30,
2013 is diluted EPS of $0.02, the first profit in PSMH's history
as a public company. This compares to our previous estimate of a
$0.07 net loss per share.
PSM Holdings, Inc. is engaged in the businesses of mortgage
banking, in which PSMH both originates and funds mortgage loans
through its own warehouse lines of credit and currently accounts
for about 90% of closed loans, as well as mortgage brokerage, in
which PSMH originates mortgage loans funded by over 50
third-party lenders. PSMH immediately sells these loans to its
third-party lenders or into the secondary mortgage market. The
Company offers a full range of mortgage loan products, including
adjustable rate mortgages, fifteen, twenty, and thirty-year fixed
rate loans, and balloon loans with a variety of maturities, as
well as refinancing, construction loans, second mortgages, debt
consolidation, and home equity loans.
PSMH had total assets of $24.7 million at the 2012 fiscal
yearend on June 30, 2012, total revenues of $14.2 million for the
2012 fiscal year, and closed 2,920 mortgage loans, worth $393
million, during this period. Operations are carried out by
the Company's wholly owned subsidiary, PrimeSource Mortgage, Inc.
(PSMI). Through this subsidiary, PSMH operates and is licensed in
the following 15 states: Arkansas, Colorado, Florida,
Iowa, Montana, Missouri, Nebraska, New Jersey, New Mexico, New
York, Oklahoma, Oregon, Texas, Utah, and Washington.
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