JPMorgan Cuts Rating on OneMain (OMF) as Borrower Pressures Remain in Focus

OneMain Holdings, Inc. (NYSE:OMF) is included among the 15 Dividend Growth Stocks with the Highest Growth Rates.

On January 12, JPMorgan expert Richard Shane downgraded OneMain Holdings, Inc. (NYSE:OMF) to Underweight from Neutral, portion raising his terms people to $65 from $59. The alteration came arsenic JPMorgan updated its user concern ratings up of Q4 earnings.

In his note, Shane warned that OneMain’s lawsuit basal could tally into much unit if prices enactment precocious and wage maturation “remains muted.” He added that tighter migration policies could connection immoderate enactment for wages, peculiarly for hourly and blue-collar workers, but inactive sees the wide setup arsenic challenging for the company’s borrowers.

In different news, Bloomberg reported connected January 14 that alternate plus manager TPG Inc. is importantly expanding its indebtedness purchases from OneMain, arsenic backstage recognition firms propulsion deeper into user lending, an country traditionally dominated by banks.

Under a forward-flow agreement, TPG is expected to bargain astir $2.4 cardinal of OneMain’s loans connected a continuing ground done June 2028, according to a connection seen by Bloomberg. That woody comes connected apical of the $1.3 cardinal the 2 sides had already agreed to, a TPG typical told Bloomberg. OneMain chiefly focuses connected idiosyncratic and car loans for non-prime borrowers.

In forward-flow arrangements similar this, an plus manager agrees to bargain loans earlier they are originated. For OneMain, it means the loans tin determination disconnected the equilibrium expanse much quickly, which helps escaped up superior and supports further lending.

OneMain Holdings, Inc. (NYSE:OMF) is simply a fiscal services holding institution that provides idiosyncratic loans, car financing, and recognition cards. It besides offers optional add-on products, runs a fiscal wellness program, services loans, and participates successful acquisitions and plus sales.

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