Listed Debt Collection/repossession Companies

[pension time bomb]

Does anyone know any debt collection/repossession companies that are listed on the London stock exchange / AIM?

I really fancy these to be big performers over the next two years as this debt/housing bubble unwinds. Would liek some exposure to this sector, so any help would be much apprecieted.

[cgnao]

Debt Free Direct (DFD)

Albemarle & Bond (ABM)

[pension time bomb]

cheers cg

[Sledgehead]

Debt Free Direct (DFD)

Albemarle & Bond (ABM)

<{POST_SNAPBACK}>

Neither of these companies are debt collection/repossession companies per se.

It would appear to me that pension time bomb wants to invest in bailiffs: boots on doorsteps etc.

The companies you have listed are :

DFD : IVA arrangers (otherwise known as debt restructurers)

ABM : pawnbrokers (retail aspect to this) / unsecured loaning (has debt collection attached but only for their loans)

The important thing in investing is not so much the apparent nature of the business but who carries the risks. If you are worried about debt default as ptb clearly is, then one of the companies above may still fit his criteria.

Debt Free Direct don't employ bailiffs: these only get involved in loan deliquency. Debt Free Directs main business is in structuring IVAs (Individual Volunatry arrangements) whereby they act as middleman between debtor and creditor to secure terms for repayment that are achievable. The debtor will typically make legally binding agreed payments to the original creditor VIA DFD. Note that DFD do NOT clear the loan with the original creditor, so if the IVA is broken they aren't saddled with the debt. Nor do they act in any way as guarantor for any of the outstanding money.

In this respect they are providing a service to creditors and debtors in difficult times and charging for this service (they do extensive affordability and credit worthiness checks that banks aren't geared up to do as I understand it). As such they have no exposure to the debt and WILL have an expanding market as more people find themselves unable to meet their loan obligations.

A PE ratio of 22.5 @ 209p with eps growth expected of 79% puts them on a PEG of 0.29 - cheap for people who follow this measure.

@ 209p the company is valued as a whole @ £77m : one would have thought this quite modest.

I should however add that in extensive back testing of correlation between share price performance and investment ratios, I have found littl eof interest so far.

Growth in earnings has been stellar, but growth rates have been declining quickly:

2004 2005P 2006E 2007E

+879 +180 +103 +55.9

The shares have almost 10 timesed over the past 2 years, so thi sis clearly not a new story.

I'd love to hear other people's views on DFD, especially those who have some experience in the IVA market. Cheers

Edited September 14, 2005 by Sledgehead

[50:50]

Does anyone know any debt collection/repossession companies that are listed on the London stock exchange / AIM?

I really fancy these to be big performers over the next two years as this debt/housing bubble unwinds. Would liek some exposure to this sector, so any help would be much apprecieted.

<{POST_SNAPBACK}>

On a similar theme, I hold a few shares in Begbies Traynor (BEG). They aren’t into debt collection or reposition but the do deal with insolvencies. The shares might look a bit pricey at the minute but they are expanding quickly. Might be worth a look (but of course, do your own research)