HGBL - Heritage Has To Work Through Its Loan Problem But Q4 Will Be Record

2024-03-08 20:36:58 ET

Summary

• Heritage Global's stock has rallied and then lost gains, mainly due to loan problems with its largest borrower.
• The company's financial segment is performing well and is expected to have a strong fourth quarter.
• Heritage Global should focus more on its brokerage segments and improve its financial reporting for long-term success.
• The author does not consider HGBL a long-term buy until the loan problem is resolved, and reporting improved.
• However, the author speculates that HGBL's 4Q23 report will have record, unexpected earnings, a situation that might be interesting for speculative investors.

Heritage Global ( HGBL ) is a distressed assets broker in physical and financial assets.

I wrote about the company one year ago, with a Hold rating. At the time, I considered the stock price already discounted most positive developments and that the market was prone to disappointments, as one-time earnings from asset sales would not repeat. ...

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