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Home Capital Group Inc. is contrasting recent financial success against its trying battle with short-sellers, as one key opponent has reportedly closed its doors.

While the Canadian housing market hasn't escaped threats of a more serious correction from economists and industry watchers, the promise of a soft landing is holding. Gerald Soloway, chief executive of the alternative mortgage lender, says the housing market is stable and that Home Capital's decision to ignore naysayers in the past year has paid off for investors.

"We kept our mouths shut, our heads down and continued to produce increasingly profitable financial results quarter after quarter," he said on an analyst conference call Thursday.

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He's referring to a conflict that began last year at a hedge fund conference, where noted investor Steven Eisman pointed to Home Capital as one of the companies most at risk of faltering due to deep weakness in the Canadian housing market. Mr. Eisman's prediction gained traction in part thanks to his successful bet against the U.S. housing market before the crash, as documented in Michael Lewis's book The Big Short.

The recommendation and resulting publicity caused Home Capital's shares to fall, Mr. Soloway noted. The stock quickly dropped to $49 and total short contracts rose to of 6 million shares, from $55 and less than 1 million shares before Mr. Eisman's comments.

Fourteen months later, not only have the company's shares recovered, but Mr. Eisman recently shuttered his firm, Emrys Partners LP, according to reports from The Wall Street Journal. It said that the two-year-old hedge fund closed down in June, as returns trailed the broader market.

Home Capital's stock, which split in February, trades at the pre-split price of $102.90, which means the stock has increased more than 100 per cent in the 14 months since Mr. Eisman made his short call. Mr. Soloway praised the company's 750 employees for keeping focused during a trying time.

In the meantime, Home Capital's business is evolving and increasingly seeking consumer deposits through its banking subsidiary Oaken Financial, a direct-to-consumer brand. The company's second quarter earnings released after the market closed Wednesday show Oaken helped boost Home Capital's total deposits to $13.8-billion billion, up 23 per cent from one year ago.

Overall, the company's results beat analysts' estimates as net income increased by nearly 20 per cent over the same time last year. The company also raised its dividend by 2 cents to 18 cents a share.

Mr. Soloway said the July housing market has shown strength, but a levelling out of prices could be close at hand. "It may not be as robust as it has been, but there's still lots of room to be a good market." Quebec's market has slowed due to the recent provincial election, but the rest of Canada's urban markets leave plenty of opportunity, he said.

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