Have you been paying attention to shares of
Ezcorp (? Shares have been on the move with the stock up 28.7% over the past month. The stock hit a new 52-week high of $9.57 in the previous session. Ezcorp has gained 29% since the start of the year compared to the -10% move for the Zacks Finance sector and the -18.5% return for the Zacks Financial - Consumer Loans industry. EZPW Quick Quote EZPW - Free Report) What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on August 3, 2022, Ezcorp reported EPS of $0.16 versus consensus estimate of $0.06 while it beat the consensus revenue estimate by 7.78%.
For the current fiscal year, Ezcorp is expected to post earnings of $0.74 per share on $848.36 million in revenues. This represents a 94.74% change in EPS on a 16.29% change in revenues. For the next fiscal year, the company is expected to earn $0.89 per share on $907.65 million in revenues. This represents a year-over-year change of 20.27% and 6.99%, respectively.
Ezcorp may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Ezcorp has a Value Score of A. The stock's Growth and Momentum Scores are B and A, respectively, giving the company a VGM Score of A.
In terms of its value breakdown, the stock currently trades at 12.9X current fiscal year EPS estimates, which is a premium to the peer industry average of 5.7X. On a trailing cash flow basis, the stock currently trades at 4.7X versus its peer group's average of 4.5X. Additionally, the stock has a PEG ratio of 0.37. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, Ezcorp currently has a Zacks Rank of #2 (Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Ezcorp fits the bill. Thus, it seems as though Ezcorp shares could still be poised for more gains ahead.
How Does EZPW Stack Up to the Competition?
Shares of EZPW have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is
Enova International, Inc. (. ENVA has a Zacks Rank of # 2 (Buy) and a Value Score of A, a Growth Score of C, and a Momentum Score of B. ENVA Quick Quote ENVA - Free Report)
Earnings were strong last quarter. Enova International, Inc. beat our consensus estimate by 3.14%, and for the current fiscal year, ENVA is expected to post earnings of $6.53 per share on revenue of $1.7 billion.
Shares of Enova International, Inc. have gained 28.2% over the past month, and currently trade at a forward P/E of 5.73X and a P/CF of 4.38X.
The Financial - Consumer Loans industry may rank in the bottom 82% of all the industries we have in our universe, but there still looks like there are some nice tailwinds for EZPW and ENVA, even beyond their own solid fundamental situation.