Q: Hi - what is the upside potential for this laggard and what are the catalysts if any
5i Research Answer:
The upside and potential catalyst for ECN will generally revolves around the macroenvironment. If rates do end up getting cut ECN could see improvements in loan demand. With that being said, ECN's struggles have been more so execution and management focus with stuggles surrounding operational efficiency. With its new partnership we may see an acquisition this year, which could improve sentiment. Investors do not like the company much right now, but it has created long term value (it paid a $7.50 dividend in 2021). EPS is expected to show a big inprovement in 2024 from a loss of 3c in 2023 to profit of 17c in 2024. This, if executed, should improve sentiment a lot.