Altisource Portfolio Solutions S.A.

The negative outlook for the next 12 months reflects our view that the moratorium on foreclosures as a result of the pandemic could further weigh on the company's operations. It also reflects the potential for additional unforeseen events, such as another material change to Altisource's relationship with a significant customer, which could jeopardize a large portion of revenue. We could lower the ratings over the next 12 months if we expect any future events to weigh on Altisource's operating results, so that EBITDA interest coverage is sustained beneath 1.5x. We could also lower the ratings if the company's liquidity position deteriorates. We could revise the outlook to stable if operating performance stabilizes and we have greater visibility into the company's

...Altisource has a largely countercyclical business model. With most of its revenues correlating with the level of mortgage foreclosures and delinquencies, Altisource Portfolio Solutions S.A. has been hurt by the moratorium on foreclosures from the CAREs Act. COVID-19-related governmental restrictions on movement and provision of certain services, social distancing requirements, the closure of or reduced services provided by certain governmental offices, vendors' refusals or inability to provide certain services in certain jurisdictions, and limitations on the availability of supplies have hurt the company's field services segment. But its operations could benefit from a rise in delinquencies or foreclosures after forbearance options are exhausted. Altisource's revenues remain highly concentrated with Ocwen. Despite management's plans to grow non-Ocwen revenues, revenues from Ocwen remain over 50% of total revenue for the first nine months of 2020. The sale of the company's financial services...

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