Seth Klarman is a well-known billionaire stock investor that runs the Baupost fund. He has a very great record of amassing big wealth through his value-based purchases. In the past quarter, he bought Ocwen (OCN) that was over $55 just a couple years ago and then it reached bottom at $6 just this year. He’s known to make safe investments that will do really well or else will only lose a little money at the end. I think that is his strategy with this company. As risky a play that Ocwen looks, it does look like it technically has hit the bottom and its time for it to rise.
Fundamentally, JP Morgan recently bought a bunch of Ocwen’s agency backed loans. The company has also sold these loans to Nationstar as well. The company wants to focus on non-agency subprime which they believe would make their customer service better for owners of these loans.
I recommend looking at OCN and putting a small percentage in it for a 20% gain at $12. Also, a stop at $9 just in case things go sour!