Piper Jaffray Reiterates OW Rating On OCN

Piper Jaffray is reiterating its Overweight rating on Ocwen Financial Corp. (NYSE: OCN) following recent travel with management.

“OCN has a number of value-creating initiatives (servicing rights acquisitions, FHA flow servicing, FNM/FRE servicing) on the horizon that could significantly boost returns and the valuation on the franchise,” Piper Jaffray writes. “Though the exact timing of these initiatives is difficult to pin down, OCN’s strong financial position (dry powder, cash flow) and attractive competitive position give us confidence that management can execute.

“The complexity of some of OCN’s initiatives certainly raises execution risks, but is also leaving the shares, trading near tangible book value, attractively valued from a risk/reward perspective, in our view.”

Ocwen Financial Corp. closed Friday at $10.40.