Top 5 Regional Bank Companies To Watch For 2015

Top 5 Regional Bank Companies To Watch For 2015: PHH Corp (PHH)

PHH Corporation (PHH), incorporated in 1953, is an outsource provider of mortgage and fleet management services. PHH operates in three segments: Mortgage Production, Mortgage Servicing and Fleet Management Services. The Company provides mortgage banking services to a range of clients, including financial institutions and real estate brokers, throughout the United States. The Company's mortgage banking activities include originating, purchasing, selling and servicing mortgage loans through its wholly owned subsidiary, PHH Mortgage Corporation and its subsidiaries (collectively PHH Mortgage). It provides commercial fleet management services to corporate clients and government agencies throughout the United States and Canada through its wholly owned subsidiary, PHH Vehicle Management Services Group LLC (PHH VMS). PHH VMS is a fully integrated provider of fleet management services with a range of product offerings, including managing and leasing vehicle fleets and providing other fee-based services for its clients' vehicle fleets.

Mortgage Production Segment

The Mortgage Production segment provides mortgage services, including private-label mortgage services, to financial institutions and real estate brokers through PHH Mortgage. The Mortgage Production segment generates revenue through fee-based mortgage loan origination services and the origination and sale of mortgage loans into the secondary market. PHH Mortgage generally sells all mortgage loans that it originates to secondary market investors, which include a variety of institutional investors, and typically retains the servicing rights on mortgage loans sold. During the year ended December 31, 2011, 92% of its mortgage loans were sold to, or were sold pursuant to, programs sponsored by Fannie Mae, Freddie Mac or Ginnie Mae and the remaining 8% were s! old to private investors. The Mortgage Production segment includes PHH Home Loans, LLC (together with its subsid iaries, PHH Home Loans), which is a joint venture that the C! ompany maintains with Realogy Corporation. The Company owns 50.1% of PHH Home Loans through its subsidiaries and Realogy owns the remaining 49.9% through their affiliates. PHH has rights to use the Century 21, Coldwell Banker and ERA brand names in marketing its mortgage loan products through PHH Home Loans and other arrangements that it has with Realogy.

The Mortgage Production segment also includes its interest in Speedy Title & Appraisal Review Services LLC (STARS), which provides appraisal services utilizing a network of professional licensed firms offering local coverage throughout the United States and also provides credit research, flood certification and tax services. On March 31, 2011, it sold 50.1% of the interests in STARS to CoreLogic, Inc. The Company operates through two principal business channels: private label services and real estate.

The retail platform consists of private label services and real estate channels. The Company is a provider of private-label mortgage loan originations for financial institutions and other entities throughout the United States. In this channel, the Company offers a complete outsourcing solution, from processing applications through funding, for clients that wish to offer mortgage services to their customers but are not equipped to handle all aspects of the process cost-effectively. The Company also purchases closed mortgage loans from financial institutions.

The Company works with real estate brokers to provide their customers with mortgage loans. Through its affiliations with real estate brokers, it has access to home buyers at the time of purchase. It works with brokers associated with NRT Incorporated, Realogy's owned real estate brokerage business, brokers associated with Realogy's franchised brokerages (Realogy Franchisees) and thir! d-party b! rokers that are not affiliated with Realogy. During 2011, approximately 22% of the Company's mortgage loan o riginations were derived from its relationship with Realogy ! and its a! ffiliates. In this channel, it also works with Cartus Corporation, Realogy's relocation business, to provide mortgage loans to employees of Cartus' clients. Cartus provides outsourced corporate relocation services in the United States. Realogy has agreed that the real estate brokerage business owned and operated by NRT Incorporated and the title and settlement services business owned and operated by Title Resource Group LLC will recommend PHH Home Loans as provider of mortgage loans to the independent sales associates affiliated with Realogy, excluding the independent sales associates of any Realogy Franchisee, and all customers of Realogy Services Group LLC and Realogy Services Venture Partner, Inc., excluding Realogy Franchisees. Certain Realogy Franchisees have agreed to recommend PHH Mortgage as provider of mortgage loans to their respective independent sales associates. As of 2011, it has entered into exclusive marketing service agreements with 5% of Realogy Franchi sees. In the Relocation Channel, the Company works with Cartus Corporation, Realogy's relocation business, to provide mortgage loans to employees of Cartus' clients.

During 2011, the Company originated mortgage loans for approximately 17% of the transactions in which real estate brokerages owned by Realogy represented the home buyer. And approximately 8% of the transactions in which real estate brokerages franchised by Realogy where it had exclusive marketing service agreements, represented the home buyer.

Mortgage Servicing Segment

The Company principally generates revenue in its Mortgage Servicing segment through fees earned from its servicing rights or from its subservicing agreements. Mortgage servicing rights are the rights to receive a portion of the interest coupon and fees collected from the mortg! agors for! performing specified mortgage servicing activities, which consist of collecting loan payments, remitting principal and interest payments to investors, managing escrow funds for th! e payment! of mortgage-related expenses, such as taxes and insurance, performing loss mitigation activities on behalf of investors, and otherwise administering its mortgage loan servicing portfolio. Mortgage servicing rights for sold loans are initially recorded at fair value in its Mortgage Production Segment's results of operations. Changes in fair value subsequent to the initial capitalization are recorded in its Mortgage Servicing Segment's results of operations. The Company's Mortgage Servicing segment also includes the results of its reinsurance activities from its wholly owned subsidiary, Atrium Reinsurance Corporation.

The Company provides mortgage reinsurance to certain third-party insurance companies that provide primary mortgage insurance on loans originated in its Mortgage Production segment. While it does not underwrite primary mortgage insurance directly, it provides reinsurance that covers losses in excess of a specified percentage of the principal b alance of a given pool of mortgage loans, subject to a contractual limit. In exchange for assuming a portion of the risk of loss related to the reinsured loans, Atrium Reinsurance Corporation, its wholly owned subsidiary, receives a portion of borrower's premiums from the third-party insurance companies.

Fleet Management Services Segment

The Company provides fleet management services to corporate clients and government agencies throughout the United States and Canada. It is an integrated provider of these services with a range of product offerings. The Company primarily focuses on clients with fleets of greater than 75 vehicles. As of 2011, it had approximately 270,000 vehicles leased, primarily consisting of cars and light-duty trucks and, to a lesser extent, medium and heavy-duty trucks, trailers and equipme! nt, and a! pproximately 300,000 additional vehicles serviced under fuel cards, maintenance cards, accident management services arrangements a nd/or similar arrangements. During 2011, the Company purchas! ed approx! imately 61,000 vehicles.

The Company provides corporate clients and government agencies with services and products, such as Fleet Leasing and Fleet Management Services, Maintenance Services, Accident Management Services, and Fuel Card Services. The Fleet Leasing and Fleet management services include vehicle leasing, fleet policy analysis and recommendations, benchmarking, vehicle recommendations, ordering and purchasing vehicles, arranging for vehicle delivery and administration of the title and registration process, as well as tax and insurance requirements, pursuing warranty claims and remarketing used vehicles. It leases vehicles to its clients under both open-end and closed-end leases. Open-end leases represent 97% of its lease portfolio, and are a form of lease in which the client bears substantially all of the vehicle's residual value risk. These leases typically have a minimum term of 12 months, and can be continued after that at the lessee's election for successive monthly renewals. Upon return of the vehicle by the lessee, it typically sells the vehicle into the secondary market, and the client receives a credit or pays the difference between the sale proceeds and the vehicle's book value.

Open-end leases may be classified as operating or direct financing depending upon the nature of the residual guarantee. Revenues for operating leases contain a depreciation component, an interest component and a management fee component, and are recognized over the lease term. For direct financing leases, revenues contain an interest component and a management fee component, and are recognized over the lease term. Closed-end leases represent 3% of its lease portfolio, and are a form of lease in which it retains the residual risk of the value of the vehicle at the end of th! e lease t! erm. Closed-end leases may be classified as operating or direct financing based on the terms of the individual contracts.

The C ompany offers clients vehicle maintenance service cards that! are used! to facilitate payment for repairs and maintenance. It maintains a network of third-party service providers in the United States and Canada to ensure ease of use by the clients drivers. The vehicle maintenance service cards provide clients with negotiated discounts off of full retail prices through its supplier network, access to its in-house team of certified maintenance experts that monitor transactions for policy compliance, reasonability and cost-effectiveness, and inclusion of vehicle maintenance transactions in a consolidated information and billing database, which assists clients with the evaluation of overall fleet performance and costs. During 2011, the Company averaged 324,000 maintenance service cards in the United States and Canada. It receives a fixed monthly fee for these services from its clients, as well as additional fees from service providers in its third-party network for individual maintenance services.

PHH provides its clients with accident management services, such as immediate assistance upon receiving the initial accident report from the driver, an organized vehicle appraisal and repair process through a network of third-party preferred repair and body shops and coordination and negotiation of potential accident claims. The Company's accident management services provide its clients with convenient, coordinated 24-hour assistance from its call center, access to its relationships with the repair and body shops included in its preferred supplier network, which typically provide clients with favorable terms, and expertise of its damage specialists, who ensure that vehicle appraisals and repairs are appropriate, cost-efficient and in accordance with each client's specific repair policy. During 2011, it averaged 298,000 vehicles that were participating ! in accide! nt management programs. The Company receives fees from its clients for these services, as well as additional fees from service providers in its third- party network for individual incident services.

It prov! ides its clients with fuel card programs that facilitate the payment, monitoring and control of fuel purchases. Fuel is typically the single fleet-related operating expense. Its fuel cards provide its clients with access to more fuel brands and outlets than other private-label corporate fuel cards, point-of-sale processing technology for fuel card transactions that enhances clients' ability to monitor purchases and consolidated billing, and access to other information on fuel card transactions, which assists clients with the evaluation of overall fleet performance and costs. Its fuel cards are offered through relationships with third parties in the United States, and a card in Canada, which offer expanded fuel management capabilities on one service card. During 2011, it averaged 295,000 fuel cards in the United States and Canada. PHH receives both monthly fees from its fuel card clients and additional fees from fuel partners and providers.

The Company competes with Bank of America, Wells Fargo Home Mortgage, Chase Home Finance, CitiMortgage, GE Commercial Finance Fleet Services, Wheels, Inc., Automotive Resources International and Lease Plan International.

Advisors' Opinion:

• [By Maria Armental var popups = dojo.query(".socialByline .popC"); popups.forEach]

  Equipment-finance company Element Financial Corp.(EFN.T) has agreed to buy PHH(PHH) Arval, the North American fleet-management unit of PHH Corp., for about $1.4 billion.

• [By Holly LaFon]

  Despite economic and political turmoil, equity markets performed well across the board in September of 2013 and over the trailing twelve months. The September gains reversed losses in August and also resulted in positive overall quarterly performance ! with a nu! mber of major indexes moving further into record territory. After disturbing the markets in May and June with comments that they may taper Quantitative Easing (QE), the Fed surprised investors with an announcement that it would not reduce its asset purchases in the near-term. The announcement removed fears that a continued rise in interest rates may stall the economic recovery, as seen by the market's negative reaction to the sharp rise in the 10-year Treasury rate in August of 2013. Investors were also comforted by improving fundamentals both domestically and abroad. The Eurozone may finally be emerging from its prolonged recession and a number of economic reports in the U.S. continue to show progress. Specifically, initial unemployment claims dropped to a multiyear low early in September and the housing market continued to improve, as evidenced by prices rising 12.4 percent year-over year, which along with the stock market's strength, has created a positive wealth effect for consumers. In response to this general economic improvement, consumer confidence increased at the end of September, and the index of leading economic indicators ticked up as well, suggesting that, absent the effects of politics, the recovery in the real economy was continuing. Our portfolios that focus on corporate restructuring (Keeley Small Cap Value, Keeley Small-Mid Cap Value, Keeley Mid Cap Value, Keeley All Cap Value, and Keeley Alternative Value) have all experienced a productive investment cycle with respect to their opportunity sets, and many of our holdings have posted impressive results in recent quarters. Although we acknowledge an improving economy has boosted the outlook for our more cyclical holdings , our research has gu

• [By Lawrence Meyers]

  X stock is a stock to short.

  Stocks to Short #2: PHH Corp. (PHH)
  

  PHH Corp. (PHH) provides both mortgage servicing and originates mortgages, though it also handles vehicle fleet services. PHH is struggling with lower total loan margins and ref! inancing ! declines.

source from Top Stocks For 2015:http://www.topstocksblog.com/top-5-regional-bank-companies-to-watch-for-2015-3.html