- MLI Marble Lending Inc. (“Marble Financial”, “company”) is a Canadian company that offers unsecured loans to individuals that are currently under a consumer proposal. To complement the company’s loan offering, the company recently acquired a suite of technology products in credit wellness and personal finance. The company’s focus is to help individuals rebuild and improve their credit score.
- Due to several macro-economic factors, the number of consumer proposals filed is expected to increase in Canada. Historically, the number of consumer proposals have seen a compound annual growth rate (“CAGR”) of nearly 12% from 2007 to 2018. In addition, the average amount of consumer debt at the time of filing for a consumer proposal increased by a CAGR of 82% from 2014 to 2018.
- There are significant opportunities for the company to establish strategic partnerships with general consumer loan providers and companies with personal-finance platforms.
- At the end of Q2-2019, the company reported $3.56 million in cash – a significant cash reserve that could be used to originate additional loans or to further develop its suite of technology products.
- Although the company’s loan portfolio showed a downward trajectory from 2015 to Q2-2019, the company has reconstituted its management team and has refocused efforts on increasing the number of loans sourced. In Q2-2019, the company sourced 25 loans, a QoQ increase of 525%.
- We are initiating coverage on MRBL with a BUY rating and a fair value estimate of $0.47 per share.
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