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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Mr. Cooper Group Inc. (XNAS:COOP) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
COOP
Name:
Mr. Cooper Group Inc. (XNAS:COOP)
Sector:
- 42000.00K
Industry:
Mortgage Finance
CEO:
Mr. Jay Bray
Total Employees:
8,200
Our Technological Advancement Rating
Our Rating:
B
Technological advancement compared to industry is 0.00% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF MR. COOPER GROUP INC.(COOP) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND MORTGAGE FINANCE INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
41.3
One Month Price Target:
$41.65
Six Month Price Target :
$43.41
Likely Price in One Year's Time:
Ticker:
$45.53
Likely Trading Range Today Under (Normal Volatility)
$41.14
Price Upper limit ($) :
$41.66
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$38.29
This week:
$34.56
This month :
$27.82
Other Primary facts
Market Cap:
2.87B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
71.65M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
19.93%
-27.97%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$55.26
$48.69
$27.34
$33.91
Medium risk (<10%) entry points
Buy Call
Sell Call
$46.55
Buy Put:
Sell Put:
$45.15
$36.03
$37.45
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
COOP
Sharpe Ratio:
6.28%
Comparison:
COOP, is amongst the top 20% stocks with highest risk-adjusted returns
Sharpe ratio is 33.21% higher than the industry
& ratio is 175.73% higher than the market/S&P 500 average
Average Returns/Yield of
COOP
Daily returns:
0.24%
Weekly returns:
1.20%
Monthly returns:
4.79%
Yearly returns:
45.31%
Comparison of returns:
Average annual returns/yield (last 3 years) is 26.85% above industry average
Classification:
COOP, is amongst the top 20% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.22
Statistical test of Returns:
COOP has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.67%
Weekly Volatility:
8.21%
Monthly Volatility:
16.41%
Yearly Volatility:
56.85%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.78%
Volatility in last five trading days has been -51.58% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-7.30%
Weekly VaR:
-16.32%
Monthly VaR:
-32.64%
How Much Can the price of
COOP
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-26%
Worst case (decline):
>85%
This translates to price declining to:
$30.52
This translates to price declining to:
$6.20
Severe Crash Probability
Risk of crash in next 6/12 months: Very high (>70%)
What is Value at Risk (VaR)?
Risk Fundamentals
COOP is a 130.34% riskier investment compared to the market/S&P 500 & is 97.34% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -5.56% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
COOP
Beta in relation to market/S&P 500--1.52
Expected beta in 1 year's time:
1.047
Expected beta in 3 year's time:
1.48
Unlevered (debt free) Beta:
1.012
Beta in relation to Nasdaq (XNAS):
1.034
Beta in relation to all global stocks::
1.187
Beta Comparison & Analysis
Beta of competitors/peers::
1.67
Beta is -8.75% lower than peers
Average Industry Beta:
1.457
Beta is 4.60% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
49.61%
Sustainable growth rate is -86.54% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.439
Alpha is 36.38% above industry average alpha yield
Alpha is 2794% higher than market/& is unsustainably high
Analysis of Cost of Capital of
COOP
Equity cost of capital:
0.136
Equity cost of capital is 3.50% above industry mean WACC
Unlevered (without debt) cost of capital:
9.02%
Before-tax cost of debt:
4.72%
After-tax cost of debt:
3.73%
Overall debt rating:
Lower BB medium grade (Fifth highest grade)
Weighted average cost of capital (WACC):
3.73%
WACC is 9.39% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$46.50
Revenue growth rate per share of (3Y):
0.74
Annual revenue growth rate is -31.40% below industry average
EPS:
$18.75
Expected Annual growth rate of EPS (3Y):
77.32%
Expected future EPS growth rate is 11.74% higher than the Mortgage Finance industry
Free cash flow (FCF) per share:
$23.56
-
-
Debt per share
$37.26
EBITDA per share
$34.45
Valuation Analysis Today of
COOP
P/E Ratio:
2.54
P/E Ratio of Competitors/Peers:
20.67
P/E ratio is -87.71% lower than main peers & is 9.26% higher than the industry
Stock price/value with industry average P/E ratio: $43.59
COOP is -5.26% undervalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
0.89
Price to sales ratio is 42.92% above the industry mean
P/B (Price to book value ratio):
0.74
Price to free cash flow: 1.75
Price to free cash flow ratio is 38.27% higher than the industry
Net income growth rate (3Y):
62.94%
Net income growth rate is -153.23% lower than the industry average net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
67.15%
Net debt to equity ratio:
173.19%
Debt to assets ratio:
18.43%
Net debt to assets ratio:
47.52%
Debt-to-asset ratio is -76.57% below industry average
Ability to repay debt:
Interest coverage ratio:
7.01
Interest coverage ratio is 3259.96% more than industry average
Looking forward:
Debt growth rate:
-42.36%
Annual debt growth is -913% lower than industry average debt growth rate
Debt repayment rate in last quarter: 8.12%
Analysis of Key Statistics
Correlation of price movement with the market:
0.581
Statistical significance of correlation:
COOP has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.456
Stock price is 27.42% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.456
Correlation of price movement with Nasdaq (^IXIC):
-0.005
Covariance of price movement with the market:
-0.01
Kurtosis
11.284
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.103
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
COOP
Gross Profit Margin Ratio:
265%
Operating Profit Margin Ratio:
50.42%
Operating profit margin is 90.96% higher than the industry
Net Profit Margin Ratio:
265%
Effective Tax Rate:
24.69%
Effective tax rate is 70.15% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
39.01%
Return on equity (ROE) is -89.83% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
10.70%
Return on assets (ROA) is 92.22% higher than the industry
Financial Leverage:
1.2x
Current Ratio:
0.76
Current ratio is 37.80% above industry average
Cash Conversion Cycle (days):
135.1
-
The remaining useful life of property plant & equipment is: 9.0 years
Stock based compensation to net income ratio:
-
In-depth Efficiency Analysis
Revenue generated per employee:
406.3K
Each employee generates 23% more revenue than industry average revenue per employee
EBITDA generated per employee:
301.0K
Each employee generates 46% more EBITDA than industry average revenue per employee
Profit generated per employee:
189.1K
Each employee generates 49% more net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 5.1K
Each employee generates -596% less free cash flow than industry average revenue per employee
Assets/Capital per employee
1.1M
Each employee generates -596% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
COOP
FULTON FINANCIAL CORPORATION (XNAS:FULT)
LIVE OAK BANCSHARES, INC. (XNAS:LOB)
TCBIP
FREEDOM HOLDING CORP. (XNAS:FRHC)
Calamos Strat Tot Ret (XNAS:CSQ)
FIRST INTERSTATE BANCSYSTEM, INC. (XNAS:FIBK)
UNITED COMMUNITY BANKS, INC. (XNAS:UCBI)
MARATHON DIGITAL HOLDINGS, INC. (XNAS:MARA)
INDEPENDENT BANK CORP. (XNAS:INDB)
Current Analyst Ratings
Strong buy�0%
Buy�0%
Hold�0%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: -
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
3.33B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
1.09B
2.24B
-
559.00M
559.00M
-
-
559.00M
202.00M
352.00M
52.00M
2.47B
1.68B
1.55B
2.08B
513.00M
1.55B
Statement of Cash Flow
Date:
Period:
11.00M
Differed Income Tax :
197.00M
Stock Based Compensation :
-
Change in Working Capital :
137.00M
Accounts Receivables:
-
Other Working Capital:
-
Other Non-Cash Items:
- 77000.00K
Net Cash Provided by Operating Activities:
926.00M
Investments in PP&E:
- 3000.00K
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
579.00M
-
579.00M
1.04B
-
3.72B
5.35B
75.00M
120.00M
6.02B
-
794.00M
2.14B
9.14B
-
14.49B
2.20B
4.80B
-
-
-
7.00B
2.67B
845.00M
3.52B
-
10.51B
1.00M
3.54B
-
438.00M
March 31, 2022 at 6:00:00 AM
1.65B
3.98B
14.49B
-
7.47B
6.9B
-
- 961000.00K
- 964000.00K
- 236000.00K
-
- 35000.00K
-
- 23000.00K
- 294000.00K
-
- 332000.00K
709.00M
1.04B
926.00M
- 968000.00K
- 42000.00K
Our Proprietary Portfolio Rating
Our Rating:
B
Price Forecast/Expected Price in Next 5 Years of
COOP
2023
2024
2025
2026
2027
$45.76
$244.01
$268.99
$296.53
$326.90