OTCPK:ECNC.F

Stock Analysis Report

Executive Summary

ECN Capital Corp. originates, manages, and advises on prime consumer credit portfolios primarily in the United States.


Snowflake Analysis

Reasonable growth potential and slightly overvalued.


Similar Companies

Share Price & News

How has ECN Capital's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ECNC.F has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-4.0%

ECNC.F

-2.2%

US Diversified Financial

-4.2%

US Market


1 Year Return

39.4%

ECNC.F

10.3%

US Diversified Financial

14.0%

US Market

Return vs Industry: ECNC.F exceeded the US Diversified Financial industry which returned 13.8% over the past year.

Return vs Market: ECNC.F exceeded the US Market which returned 17.8% over the past year.


Shareholder returns

ECNC.FIndustryMarket
7 Day-4.0%-2.2%-4.2%
30 Day9.9%-1.8%-1.8%
90 Day28.3%1.6%2.6%
1 Year42.0%39.4%10.5%10.3%16.3%14.0%
3 Year70.5%63.6%29.2%28.8%43.2%34.0%
5 Yearn/a49.3%48.7%65.9%47.6%

Price Volatility Vs. Market

How volatile is ECN Capital's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is ECN Capital undervalued compared to its fair value and its price relative to the market?

45.8%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: ECNC.F ($4.51) is trading below our estimate of fair value ($8.04)

Significantly Below Fair Value: ECNC.F is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: ECNC.F is unprofitable, so we can't compare its PE Ratio to the Diversified Financial industry average.

PE vs Market: ECNC.F is unprofitable, so we can't compare its PE Ratio to the US market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate ECNC.F's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: ECNC.F is overvalued based on its PB Ratio (1.5x) compared to the US Diversified Financial industry average (0.8x).


Next Steps

Future Growth

How is ECN Capital forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

111.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ECNC.F is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (1.7%).

Earnings vs Market: ECNC.F is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: ECNC.F's is expected to become profitable in the next 3 years.

Revenue vs Market: ECNC.F's revenue (15.8% per year) is forecast to grow faster than the US market (7.6% per year).

High Growth Revenue: ECNC.F's revenue (15.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ECNC.F's Return on Equity is forecast to be low in 3 years time (13.4%).


Next Steps

Past Performance

How has ECN Capital performed over the past 5 years?

-71.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ECNC.F is currently unprofitable.

Growing Profit Margin: ECNC.F is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: ECNC.F is unprofitable, and losses have increased over the past 5 years at a rate of -71.7% per year.

Accelerating Growth: Unable to compare ECNC.F's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: ECNC.F is unprofitable, making it difficult to compare its past year earnings growth to the Diversified Financial industry (55.1%).


Return on Equity

High ROE: ECNC.F has a negative Return on Equity (-0.47%), as it is currently unprofitable.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is ECN Capital's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet

Inventory Level: ECNC.F has a low level of unsold assets or inventory.

Debt Coverage by Assets: ECNC.F's debt is covered by short term assets (assets are 1.9x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: ECNC.F has been profitable on average in the past, therefore cash runway is not a concern.

Forecast Cash Runway: ECNC.F has been profitable on average in the past, therefore cash runway is not a concern.


Financial Institutions Analysis

Asset Level: ECNC.F's level of assets compared to its equity is low.

Allowance for Bad Loans: Insufficient data to determine if ECNC.F has a sufficient allowance for bad loans.

Low Risk Liabilities: ECNC.F reports no customer deposits, loans are made up entirely of externally borrowed funds.

Loan Level: Insufficient data to determine if ECNC.F has an acceptable proportion of non-loan assets held.

Low Risk Deposits: ECNC.F has advanced significantly more loans than the customer deposits it holds.

Level of Bad Loans: Insufficient data to determine if ECNC.F has an appropriate level of bad loans.


Next Steps

Dividend

What is ECN Capital's current dividend yield, its reliability and sustainability?

1.73%

Current Dividend Yield


Dividend Yield vs Market

company1.7%marketbottom25%1.5%markettop25%3.8%industryaverage2.1%forecastin3Years2.2%

Current dividend yield vs market & industry

Notable Dividend: ECNC.F's dividend (1.68%) is higher than the bottom 25% of dividend payers in the US market (1.45%).

High Dividend: ECNC.F's dividend (1.68%) is low compared to the top 25% of dividend payers in the US market (3.73%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, ECNC.F has been paying a dividend for less than 10 years.

Growing Dividend: ECNC.F's dividend payments have increased, but the company has only paid a dividend for 3 years.


Current Payout to Shareholders

Dividend Coverage: ECNC.F is paying a dividend but the company is unprofitable.


Future Payout to Shareholders

Future Dividend Coverage: ECNC.F's dividends in 3 years are forecast to be well covered by earnings (23.8% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.1yrs

Average management tenure


CEO

Steve Hudson (60yo)

3.3yrs

Tenure

US$4,247,126

Compensation

Mr. Steven K. Hudson, also known as Steve, FCA, B.B.A., FCPA, is the Founder and Principal of Cameron Capital Corporation. Mr. Hudson has been the Chief Executive Officer and Executive Director of ECN Capi ...


CEO Compensation Analysis

Compensation vs Market: Steve's total compensation ($USD4.25M) is above average for companies of similar size in the US market ($USD2.51M).

Compensation vs Earnings: Steve's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Steven Hudson
CEO & Director3.3yrsUS$4.25m5.45% $56.7m
Michael Lepore
Chief Financial Officer0.9yrsUS$3.31m0.11% $1.2m
John Wimsatt
Head of Corporate Development & Investor Relations3.1yrsno data0.22% $2.3m
Mary Koenig
Chief Legal Officer1.1yrsno datano data
Steve Grosso
Chief Operating Officer of US0yrsno datano data
Ian Berch
Chief Operating Officer of Service Finance2.1yrsno datano data
Algis Vaitonis
Chief Credit Officer0yrsno datano data
Randall Lyle Yasny
Senior Vice President of Corporate0yrsno data0.32% $3.4m
Donald Glisson
Chief Executive Officer of Triad Financial Services2.1yrsno datano data
Mark Berch
President of Service Finance2.4yrsno datano data

2.1yrs

Average Tenure

Experienced Management: ECNC.F's management team is considered experienced (2.1 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Steven Hudson
CEO & Director3.3yrsUS$4.25m5.45% $56.7m
Paul Stoyan
Independent Director3.3yrsUS$63.95k0.25% $2.6m
Carol Goldman
Independent Director2.8yrsUS$185.00k0.012% $129.9k
William Lovatt
Independent Chairman of the Board3.3yrsUS$535.00k0.29% $3.0m
Pierre Lortie
Independent Director3.3yrsUS$234.15k0.14% $1.5m
Karen Martin
Director0.5yrsno data0.036% $375.4k
David Morris
Independent Director3.3yrsUS$180.14k0.012% $129.9k

3.3yrs

Average Tenure

62.5yo

Average Age

Experienced Board: ECNC.F's board of directors are considered experienced (3.3 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

ECN Capital Corp.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: ECN Capital Corp.
  • Ticker: ECNC.F
  • Exchange: OTCPK
  • Founded: 2016
  • Industry: Specialized Finance
  • Sector: Diversified Financials
  • Market Cap: CA$1.381b
  • Listing Market Cap: CA$1.040b
  • Shares outstanding: 240.13m
  • Website: https://www.ecncapitalcorp.com

Number of Employees


Location

  • ECN Capital Corp.
  • Royal Bank Plaza
  • Suite 1625
  • Toronto
  • Ontario
  • M5J 2J1
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ECNTSX (The Toronto Stock Exchange)YesCommon SharesCACADSep 2016
ECNC.FOTCPK (Pink Sheets LLC)YesCommon SharesUSUSDSep 2016
2EZDB (Deutsche Boerse AG)YesCommon SharesDEEURSep 2016
ECN.PRCTSX (The Toronto Stock Exchange)PFD CUM SER CCACADMay 2017

Biography

ECN Capital Corp. originates, manages, and advises on prime consumer credit portfolios primarily in the United States. The company operates through Service Finance - Unsecured Consumer Loans; Triad - Secured Consumer Loans; and Kessler – Consumer Credit Cards segments. It provides prime credit portfolio solutions that include unsecured consumer loan portfolios, including home improvement loans; secured consumer loan portfolios, such as manufactured home loans; and consumer credit card portfolios. The company serves banks and credit unions. ECN Capital Corp. was founded in 2016 and is headquartered in Toronto, Canada. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/25 01:47
End of Day Share Price2020/02/24 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.