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djsp - DJSP continued troubles in industry.
Seems there is increasing scrutiny of the foreclosure markets and with DJSP centered the way they are with the foreclosure markets it still seems like a decent short idea. Yes it has a tremendously low PE but the more I try to look where the cash from earnings has gone previously the more I kinda have that little voice in the back of the head going 'hmmmm'.
http://finance.yahoo.c...=
I believe the company had the recent class action stuff on them plus now the whole industry looks like it is getting scrutinized with the above article.
Throw in that when I looked to see what happened to the company's huge earnings numbers as far as where cash went on the balance sheet and it looked to me like the CEO had been pocketing it for the most part (as compensation I guess).
Makes me keep going 'hmmmm'. I am not short this but am watching to see how this turns out and have had my eyebrow raised on them since the double digits. Don't think I posted about them here though until they were well below those highs.
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Thanks for the update on this one. What additional developments here (if any) would make you want to short it?
The company does not have a lot of cash on its balance sheet. With the class action suits and the further scrutiny intensity on this segment of industry, what happens if they settle for large $ amounts or have other legal claims against them? Remember, IMO most of that big $ they made last couple years already got paid out as 'Distributions and dividends' per their annual filing (page thru to cash flows).
http://www.sec.gov/Arc...
Geez, even their $10 mill LOC looks like much of it was paid out for distributions and dividends it looks like in year 2009. With those earnings paid out and looks like even some of their LOC, I find it hard to fathom the company going back and saying 'can we have back the dividends and distributions to help pay some legal costs for settlement?'... Stinks to me but just my opinion...
Also saw this general article from Yahoo: http://finance.yahoo.c...=
This doesn't look good for Stern and DJSP IMO:
http://www.businesswee...