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PRA Group's (PRAA) Q2 Earnings Beat Estimates, Fall Y/Y

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PRA Group Inc.’s (PRAA - Free Report) second-quarter 2019 earnings per share of 41 cents beat the Zacks Consensus Estimate by 10.8%, mainly attributable to growth in revenues. However, the bottom line declined 4.7% year over year.

Meanwhile, its total revenues were $252 million, up 13.5% from the year-ago quarter. The top line also surpassed the Zacks Consensus Estimate by 2.9% on the back of higher finance receivables of the company.

The company witnessed cash collection of $470.3 million, which rose 16% from the figure reported in second-quarter 2018 on the back of U.S. legal cash collections and U.S. call center plus other such collections.

PRA Group, Inc. Price, Consensus and EPS Surprise

Quarterly Operational Update

PRA Group’s fee income of $2.7 million increased 15.6% year over year.
The company’s finance receivables during the reported period grew 13.8% year over year to $249.2 million, primarily because of the Americas Core portfolio investment in 2018, certain purchases made in Europe Core and yield raises in Core.  

Total operating expenses increased 14.8% year over year to $187.5 million. This deterioration was due to higher legal collection costs and fees plus higher agency fees.

Business Update

The company spent $289.1 million on finance receivables in the quarter under review.  

Financial Update

As of Jun 30, 2019, the company had total assets of $4.1 billion, up 6.5% from the level at 2018 end.
PRA Group exited the quarter with total equity of $1.1 billion, up 2.4% from the level on Dec 31, 2018.

Cash and cash equivalents in the quarter under discussion were $105 million, up 6.9% from the year-end 2018

In the quarter under consideration, borrowings increased 5.9% to $2.6 billion.

Zacks Rank and Performance of Other Players

PRA Group 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 finance sector having reported second-quarter earnings so far, the bottom-line results of Synchrony Financial (SYF - Free Report) and Discover Financial Services (DFS - Free Report) beat the respective Zacks Consensus Estimate while that of MarketAxess Holdings Inc. (MKTX - Free Report) missed the same.

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