By: Dylan Sikes - AllPennyStocks.com News

Tuesday, November 17, 2015

The financial crisis of 2008/2009 was preceded by a credit boom in the U.S. Years of easy monetary policy from the Federal Reserve and low yields led to a credit boom that turned out to be too good to be true for indebted consumers and businesses. With lenders able to easily package and sell their debt in the secondary market, borrowers with poor credit scores also got access to mortgages and consumer debt. The credit boom though was never going to sustain and in 2008 the bubble burst.

One of the consequences of the credit bubble bursting has been consumers laden with very high debt levels. This is one of the reasons why the U.S. economic recovery has been slow. However, debt-laden consumers have also created an opportunity for companies that provide debt management services.

While the U.S. economy continues to recover, the consumer debt management industry is still seeing significant growth. The growth was reflected in Debt Resolve Inc.’s (OTCPK:DRSV) financial results for the third quarter, which were released this morning. Based in White Plains, New York, Debt Resolve’s traditional SaaS business provides lenders, debt buyers, collection agencies, collection law firms and hospitals with a patent-protected online bidding system for the resolution and settlement of consumer debt.

DRSV said that its unaudited revenue for the third quarter were $2.24 million, representing an increase of 56% over the previous quarter. Operating income for the third quarter was a record $520,673. Operating income rose 88% on a sequential basis. The company reported a net loss of $1.43 million for the third quarter, compared to net income of $627,187 reported for the same period in the previous year.

DRSV said that its third-quarter results reflected an excess derivative liability expense of $1.24 million, compared to a gain of $267,532 reported in the previous quarter. The company’s previous quarter results also included a one-time gain of $650,319. Excluding these items, the company had a loss of $290,664 in the previous quarter. Adjusted loss in the third quarter was $193,223.

Stan Freimuth, CEO at Debt Resolve, said that the company is excited by the continued organic growth in its majority-owned joint venture. Freimuth further said that the third quarter marks the third consecutive quarter of record revenues and operating income growth. He added that while the company anticipates other new joint ventures will be introduced over the course of the next year, additional focus will also be placed on operational efficiencies in the current businesses.

Shareholders of DSRV seem to be cheering on the announcement today, sending shares up over 25% by early-afternoon trading. Shares are up over 300% since the summer, another plus for shareholders looking for a quick growing penny stock.

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