At last a company i know something about. i have meet Thomas a couple of times, in a professional capacity (PM/analyst), it was some time ago!
these guys are leaders in the field of debt purchase and recovery.
there are two main issues to consider with the purchase of a debt book. these are typically books of unpaid debts (telcos/utilities etc) with many (thousands) of small amounts. the holder of the debt book will sell it to a recovery company like CCP. obviously there are many assumptions and how conservative they are is important. the level of competition for the book is cyclical and varies but is important as it directly impacts returns. So a $100 FV book will be bid for and may go for $50-60 (guess) but can go higher or lower as competition can occur, so lower competition or tight financial conditions can be favourable for a rational, well financed bidder like CCP.
the other part of the equation is that books of debt are bid under assumptions regarding recovery which are directly linked to economic conditions. as i recall the length of book recovery can be a few years, so that is the exposure. as you may imagine when things unexpectedly deteriorate recovery can be well below expectations. C19 was a good example as a situation where initial assumptions were likely to prove optimistic. it worked out in the end, given Govt largesse, but CCP share price took a beating and the company look a large provision, which, i believe it wrote much of it back over time.
as you can see this business requires discipline and patience and returns can vary due to the reasons mentioned above. over time returns have proven relatively attractive for a few players like CCP, in Australia where CCP dominates.
the benefit of the US expansion, imo, is still not clearly decided.
finally the personal loan book, imo, looks generic where really anyone can lend $. there are many NBFI trying, with varying results , to be generous. i am sure they disagree with this summation.
in terms of investment, imo, the right approach is to buy CCP in tough times (when write off fears are high) as long as survival is a high probability . maybe that situation is coming now. i ahve used P/bk or normalised ROE to give a PE as two approached.
hopefully these comments are not out of date are of some use. As always i could be wrong.
disc not held