Lender Processing Services Dives on Earnings Revision

Shares of Lender Processing Services LPS are crashing in the after-hours trade following a revision to the company's guidance for Q2. Currently, shares are off 7.40%, at $21.64; they closed the regular session lower by 3.71%, at $23.37. Lender Processing Services said that is sees Q2 EPS of $0.54-0.56; the Street was at $0.80. This updated outlook reflects further weakness in default volumes and continued sluggish origination activity, in particular, in the refinancing marketplace. Lower default volumes will in turn impact related revenues in LPS' Other TD&A sub-segment. "While we are experiencing very difficult market conditions, our business model remains intact and we continue to be well-positioned to gain additional market share. As a clear demonstration of our strong client relationships and our clients' trust in us, I am pleased to report that we completed the conversion of a major financial institution on to our Desktop platform in early June," said Jeff Carbiener, President and CEO of LPS. Lender Processing Services, Inc. is a provider of integrated technology and services to the mortgage lending industry, with mortgage processing and management services in the United States. The company operates in two segments: technology, data and analytics and loan transaction services, which produced approximately 30% and 70%, respectively, of the company's revenues during the year ended December 31, 2009. A number of financial institutions use LPS's solutions.