A month has gone by since the last earnings report for PRA Group (PRAA - Free Report) . Shares have added about 1.1% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is PRA Group due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
PRA Group Q4 Earnings Beat Estimates, Improve Y/Y
PRA Group’s fourth-quarter 2021 earnings per share of 79 cents beat the Zacks Consensus Estimate and also increased year over year by 21.5% owing to lower expenses.
Revenues of $256.9 million were down 6.2% from the year-ago quarter’s level due to lower portfolio income. However, the top line surpassed the Zacks Consensus Estimate by 2.4%.
PRAA’s cash collection of $473.7 million decreased 1.7% from the year-ago figure due to a decrease in U.S. call center and other cash collections as well as Brazil cash collections.
Quarterly Operational Update
PRA Group’s fee income of $3.8 million increased 32% year over year.
PRAA’s portfolio income came in at $211.6 million during the quarter under review, down 9.4% year over year.
Total operating expenses were down 5.5% year over year to $174.48 million on lower compensation and employee services, legal collection costs, agency fees, outside fees and services, depreciation and amortization.
Business Update
PRA Group purchased $201.7 million of nonperforming loan portfolios.
Share Repurchase Update
PRAA bought back shares worth $139 million in the fourth quarter of 2021. Management also authorized a new $150-million program upon completion of the previous program.
2021 Update
PRAA delivered cash collections of $2.1 billion for the full year. In 2021, this financial Miscellaneous services company came up with revenues of $1.1 billion, up 2.8% year over year.
Financial Update (as of Dec 31, 2021)
PRAA had total assets worth $4.3 billion, down 1.9% from the level at 2020 end.
PRA Group exited the fourth quarter with total equity of $1.3 billion, down 3.5% from the level on Dec 31, 2020.
Cash and cash equivalents in the quarter under discussion were $87.5 million, down 19.4% from the level at 2020 end.
At the end of the fourth quarter, borrowings decreased 2% to $2.6 billion from the number at 2020 end.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates flatlined during the past month.
The consensus estimate has shifted 7.69% due to these changes.
VGM Scores
At this time, PRA Group has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. Following the exact same course, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
PRA Group has a Zacks Rank #5 (Strong Sell). We expect a below average return from the stock in the next few months.
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A month has gone by since the last earnings report for PRA Group (PRAA - Free Report) . Shares have added about 1.1% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is PRA Group due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
PRA Group Q4 Earnings Beat Estimates, Improve Y/Y
PRA Group’s fourth-quarter 2021 earnings per share of 79 cents beat the Zacks Consensus Estimate and also increased year over year by 21.5% owing to lower expenses.
Revenues of $256.9 million were down 6.2% from the year-ago quarter’s level due to lower portfolio income. However, the top line surpassed the Zacks Consensus Estimate by 2.4%.
PRAA’s cash collection of $473.7 million decreased 1.7% from the year-ago figure due to a decrease in U.S. call center and other cash collections as well as Brazil cash collections.
Quarterly Operational Update
PRA Group’s fee income of $3.8 million increased 32% year over year.
PRAA’s portfolio income came in at $211.6 million during the quarter under review, down 9.4% year over year.
Total operating expenses were down 5.5% year over year to $174.48 million on lower compensation and employee services, legal collection costs, agency fees, outside fees and services, depreciation and amortization.
Business Update
PRA Group purchased $201.7 million of nonperforming loan portfolios.
Share Repurchase Update
PRAA bought back shares worth $139 million in the fourth quarter of 2021. Management also authorized a new $150-million program upon completion of the previous program.
2021 Update
PRAA delivered cash collections of $2.1 billion for the full year. In 2021, this financial Miscellaneous services company came up with revenues of $1.1 billion, up 2.8% year over year.
Financial Update (as of Dec 31, 2021)
PRAA had total assets worth $4.3 billion, down 1.9% from the level at 2020 end.
PRA Group exited the fourth quarter with total equity of $1.3 billion, down 3.5% from the level on Dec 31, 2020.
Cash and cash equivalents in the quarter under discussion were $87.5 million, down 19.4% from the level at 2020 end.
At the end of the fourth quarter, borrowings decreased 2% to $2.6 billion from the number at 2020 end.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates flatlined during the past month.
The consensus estimate has shifted 7.69% due to these changes.
VGM Scores
At this time, PRA Group has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. Following the exact same course, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
PRA Group has a Zacks Rank #5 (Strong Sell). We expect a below average return from the stock in the next few months.
Just Released: Zacks Top 10 Stocks for 2024
Hurry – you can still get in early on our 10 top tickers for 2024. Hand-picked by Zacks Director of Research, Sheraz Mian, this portfolio has been stunningly and consistently successful. From inception in 2012 through November, 2023, the Zacks Top 10 Stocks gained +974.1%, nearly TRIPLING the S&P 500’s +340.1%. Sheraz has combed through 4,400 companies covered by the Zacks Rank and handpicked the best 10 to buy and hold in 2024. You can still be among the first to see these just-released stocks with enormous potential.
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