Happy Monday,
It hasn’t been a great year for Navient.
The Wilmington company, which was spun off a few years ago from Sallie Mae, has been buffeted by a lawsuit from the Pennsylvania Attorney General and at least one highly publicized shareholder suit.
Acquisitions that have included online student lender Earnest and the parking payment processing operations of Duncan (a company that used to make parking meters) have not helped.
When Donald Trump took office, some felt that Navient would benefit if the administration stopped regulatory scrutiny of the company. So far, little has happened and investors have stayed on the sidelines.
Even a five percent stock dividend has not been much of an incentive as Navient’s share price remained unchanged in a period where many companies saw double-digit gains.
One long-time Navient fan has jumped off the bandwagon
Bloomberg reports that Leon Cooperman, a billionaire hedge fund owner, says investors would be better off its operations were dismantled and sold off.
While defending the company, Cooperman sees Navient facing too many headwinds from regulators and critics.
Navient may still have time to appease investors, but the clock is ticking.
None of this is good news for the local economy and only adds to the urgency to stay focused on the key financial services segment.
We did see some good news late last week with WSFS inking a deal with online lender SoFi for servicing a debit card. SoFi plans to add hundreds of jobs at its Claymont offices and has several open positions posted online.
Financial services companies will continue to see turmoil and the only sound strategy is to redouble efforts in retaining and attracting start-ups as well as mature companies.
As always your thoughts and observations are welcome. Simply hit reply to this message and type away. – Doug Rainey, Publisher
