Dallas, Texas 11/08/2013 (Financialstrend) – The business services provider Asta Funding, Inc. (NASDAQ:ASFI) which focuses on servicing banks and financial institutions via its debt collection service has been struggling to keep up its revenue inflow as its sales numbers come under pressure over the past few quarters. While its sales for the past 12 months has come in at $44.3 million and generated net income of $2.3 million. Part of this income has been ploughed back to its investors in the form of $0.08 dividend which translates to a dividend yield of 0.95%.
The firm makes money by collecting debt which has been bucketed as bad debt by other financial firms. The firm had made a big purchase of such dicey bad debt in the 2007 time frame. Unfortunately for the firm that risk proved foolhardy and since then it is trying to sustain its profitability. In addition the firm has managed to earn recurring income from previous portfolios which have been parked under amortized assets with a notational zero value.
During trading on November 6, the stock had posted small return of 0.24% in comparison to its previous day close price. This upward movement in the stock seems to be an aberration when the past 12 months performance of the stock on the stock exchange is concerned. It has been consistently underperforming with 1.7% dip in past quarter and a significant 7% dip in value over the past 12 months.
This nonstop erosion in the value of the stock coupled with negligible dividend yield has rendered this stock as a non performer to many individual share holders. At current valuations the stock is trading at $8.45 per share and is 7.1% up from its 52 week low price point. The stock has breached the price target of $8 set by analysts which indicate that further depreciation in the stock value can be expected in the short term