from the Annual Report - "As previously reported, the Company recorded a relatively high PDL impairment expense for the year. This is due to the impact of a number of factors including above-forecast collection revenue and modest levels of purchasing, together with a revision of future collections to account for the impact of projected increases in unemployment associated with the economic downturn".
From this I take it that unemployment is really bad news for Credit Corp. If a debtor does not have a job, no matter how hard you might try to persuade them, they cannot pay back the debt. It doesn't matter how cheap the debt is!
Probably a bit of an unfounded generalization, but those with debt are also likely to be in line for losing their jobs.
Hopefully for Credit Corp unemployment may not get too much worse?
Also, Id76 does make some insightful observations.
With Id76's comments in mind I should have looked at risk/reward for this stock (which I have made a substantial paper profit). However, the price having fallen back somewhat makes me think that it now has some value to justify holding.
CCP Price at posting:
$1.65 Sentiment: None Disclosure: Held
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