Altisource Portfolio Solutions S.A.

While mortgage foreclosures could rise as a result of difficult macroeconomic conditions, we don't expect Altisource's higher-margin marketplace business to significantly improve over the next 12 months. That said, the company reported positive EBITDA in 2023, and we expect EBITDA will continue to grow in 2024. The company's senior secured term loan matures April 2025, with the option to extend to April 2026 subject to certain terms and conditions, including a $30 million par paydown (which was met in 2023). We believe refinancing risk for the term loan persists. The stable outlook on Altisource Portfolio Solutions S.A. reflects S&P Global Ratings' view that over the next 12 months, the company will continue to generate weak cash flow from operations due

...Altisource currently has weak cash flow generation due to its largely countercyclical business model, and we think it will remain weak going into 2025. Most of the company's revenue correlates with residential mortgage foreclosures and delinquencies in the U.S., which have remained low because of strong home prices and significant equity in homes. As a result, Altisource's cash flow from operations remained negative in 2022 and 2023, with second-quarter 2024 being the first quarter of positive cash flow since the COVID-19 pandemic. In prior years, the moratorium on foreclosures from the CARES Act, which ended in 2021, hurt Altisource's cash flow and profitability. While mortgage foreclosures could rise as a result of difficult macroeconomic conditions, we don't expect Altisource's higher-margin marketplace business to significantly improve over the next 12 months. That said, the company reported positive EBITDA in 2023, and we expect EBITDA will continue to grow in 2024. We think Altisource...

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