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PRA Group (PRAA) Q1 Earnings Miss, Revenues Beat Estimates

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PRA Group Inc.’s (PRAA - Free Report) first-quarter 2017 earnings per share of 38 cents missed the Zacks Consensus Estimate by 13.6%. The bottom line also deteriorated 55.3% from the year-ago quarter due to lower revenues.

 

 

Operational Update

PRA Group’s total revenue was $207 million, down 8% year over year. Revenues, however, surpassed the Zacks Consensus Estimate by 4.5%. The year-over-year decline may be attributed to lower income from net receivables and reduced fee income.

Additionally, PRA Group’s revenues from finance receivables income fell 6.3% to $194 million. Fee income of $9.9 million plunged 40% due to the sale of the Government Services business in the first quarter. Other revenues inched up roughly 2.7% to $2.2 million.

Total operating expenses decreased 0.6% year over year to $153.3 million. This was mainly due to lower agency fees, outside fees and services, communication expenses and depreciation & amortization expenses.  This downside was partially offset by higher compensation and employee service expenses, legal collection costs and other operating expenses.

PRA Group, Inc. Price, Consensus and EPS Surprise


Financial Update

As of Mar 31, 2017, PRA Group had total assets worth $3.2 billion, up 0.32% from year-end 2016.

The company exited the quarter with total equity of $980.7 million, up 7% from Dec 31, 2016.

As of Mar 31, 2017, cash and cash equivalents were $82 million, down 12.8% from year-end 2016.

In the reported quarter, borrowings declined 4.3% to $1.7 billion.

Zacks Rank and Performance of Other Insurers

PRA Group currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Among other players from the same space that have reported first-quarter earnings so far, the bottom line at The Progressive Corporation (PGR - Free Report) , The Travelers Companies, Inc. (TRV - Free Report) and RLI Corp. (RLI - Free Report) missed their respective Zacks Consensus Estimate.

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