Mr Cooper Group Inc (COOP)

[jaysenese]

COOP downgraded today at Piper Jaffray from Neutral to Underperform.


"Piper Jaffray analyst Kevin Barker downgraded Mr. Cooper to Underweight from Neutral and cut his price target for the shares to $9.00 from $15.50. As the company goes through a phase of de-leveraging, earnings expectations will need to come down and the long-term outlook will become more obscure, Barker tells investors in a research note. He believes the stock should trade at a "meaningful discount" to economic tangible book value pending confidence Mr. Cooper can generate ~$1.50/share in GAAP earnings per share. The analyst believes a multiyear process of cost cutting and de-leveraging will result in a "painful near-term reality for shareholders."

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One thing to remember is that his previous opinion was "Neutral", which was effectively already a poor opinion. There wouldn't be many Piper Jaffray institutional customers holding COOP shares who would be sellers today based on this downgrade - they would already have sold their COOP based on that original Neutral opinion.

I'd like to think this could be a buying opportunity, if the other brokerages following COOP hold firm with their price targets.