Altisource Portfolio Solutions (NASDAQ:ASPS)

This is a long-time holding of mine. It spun off two companies, whose stocks performed spectacularly, (though I recently sold one of them due to a long-term decline the stock price went into). And along the way, this stock has also performed well for me, so I have kept it.

Sales have grown 32% per year for the past two years, and EPS is up 43% per year during that time. The profit margin has been on a steady uptrend for 5 years now, and the earned-on-equity has grown well over the past 4 years. One big concern is that they took on a lot of debt last year, raising it to 124% of equity, from almost no debt the year before. The debt is long-term, and they used it to buy some assets and to stockpile cash, (assumedly to purchase more assets in the future). The P/E is higher than it has been in 5 years, and almost double its historical average, though the PEG ratio is good, so that somewhat justifies the high P/E number

At growth rates half the historic numbers, this stock should return me over 50% over the next 5 years, or about 8% per year. But at current growth rates, if they could be sustained, the stock could return as much as 26% per year. I expect the return to be somewhere in between those numbers. So it it returns 17% per year, then it will exceed my goal for the stock. I'll just have to keep an eye on the growth rate to make sure it can still perform up to my expectations. If growth falls too much, then the purpose for holding this stock could evaporate, leading me to sell it. However, the current growth shows no sign of slowing yet, so I will hold on for now.