ENCORE CAPITAL GROUP INC (ECPG) Stock Fundamental Analysis
USA - NASDAQ:ECPG - US2925541029 - Common Stock
41.36 USD
+0.83 (+2.05%)
41.36 USD
0 (0%)
We assign a fundamental rating of 3 out of 10 to ECPG. ECPG was compared to 55 industry peers in the Consumer Finance industry. ECPG has a medium profitability rating, but doesn't score so well on its financial health evaluation. ECPG is valued quite cheap, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
ECPG had positive earnings in the past year.
In the past year ECPG had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: ECPG reported negative net income in multiple years.
Each year in the past 5 years ECPG had a positive operating cash flow.
1.2 Ratios
ECPG has a Return On Assets of -1.71%. This is amonst the worse of the industry: ECPG underperforms 83.64% of its industry peers.
ECPG has a Return On Equity of -9.91%. This is amonst the worse of the industry: ECPG underperforms 85.45% of its industry peers.
ECPG's Return On Invested Capital of 5.89% is fine compared to the rest of the industry. ECPG outperforms 69.09% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ECPG is significantly below the industry average of 10.98%.
The 3 year average ROIC (5.57%) for ECPG is below the current ROIC(5.89%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -1.71% | ||
| ROE | -9.91% | ||
| ROIC | 5.89% |
ROA(3y)-1.02%
ROA(5y)1.78%
ROE(3y)-7.9%
ROE(5y)4.66%
ROIC(3y)5.57%
ROIC(5y)6.77%
1.3 Margins
The Operating Margin of ECPG (25.28%) is better than 81.82% of its industry peers.
ECPG's Operating Margin has declined in the last couple of years.
The Gross Margin of ECPG (78.54%) is better than 67.27% of its industry peers.
ECPG's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 25.28% | ||
| PM (TTM) | N/A | ||
| GM | 78.54% |
OM growth 3Y-11.86%
OM growth 5Y-8.47%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.31%
GM growth 5Y-0.74%
2. Health
2.1 Basic Checks
ECPG has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
ECPG has more shares outstanding than it did 1 year ago.
ECPG has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, ECPG has a worse debt to assets ratio.
2.2 Solvency
ECPG has an Altman-Z score of 0.92. This is a bad value and indicates that ECPG is not financially healthy and even has some risk of bankruptcy.
ECPG has a better Altman-Z score (0.92) than 65.45% of its industry peers.
ECPG has a debt to FCF ratio of 41.46. This is a negative value and a sign of low solvency as ECPG would need 41.46 years to pay back of all of its debts.
With a Debt to FCF ratio value of 41.46, ECPG perfoms like the industry average, outperforming 45.45% of the companies in the same industry.
ECPG has a Debt/Equity ratio of 4.43. This is a high value indicating a heavy dependency on external financing.
ECPG has a worse Debt to Equity ratio (4.43) than 63.64% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.43 | ||
| Debt/FCF | 41.46 | ||
| Altman-Z | 0.92 |
ROIC/WACC0.83
WACC7.07%
2.3 Liquidity
ECPG has a Current Ratio of 0.97. This is a bad value and indicates that ECPG is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 0.97, ECPG is in line with its industry, outperforming 47.27% of the companies in the same industry.
A Quick Ratio of 0.97 indicates that ECPG may have some problems paying its short term obligations.
ECPG has a Quick ratio (0.97) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.97 | ||
| Quick Ratio | 0.97 |
3. Growth
3.1 Past
ECPG shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 187.20%, which is quite impressive.
Measured over the past years, ECPG shows a decrease in Earnings Per Share. The EPS has been decreasing by -3.19% on average per year.
The Revenue has grown by 13.96% in the past year. This is quite good.
The Revenue has been decreasing by -1.19% on average over the past years.
EPS 1Y (TTM)187.2%
EPS 3Y-24.04%
EPS 5Y-3.19%
EPS Q2Q%85.82%
Revenue 1Y (TTM)13.96%
Revenue growth 3Y-2.39%
Revenue growth 5Y-1.19%
Sales Q2Q%20.45%
3.2 Future
ECPG is expected to show a very negative growth in Earnings Per Share. In the coming years, the EPS will decrease by -19.01% yearly.
Based on estimates for the next years, ECPG will show a very negative growth in Revenue. The Revenue will decrease by -22.84% on average per year.
EPS Next Y65.87%
EPS Next 2Y29.13%
EPS Next 3Y-19.01%
EPS Next 5YN/A
Revenue Next Year15.63%
Revenue Next 2Y10.63%
Revenue Next 3Y-22.84%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 5.76, the valuation of ECPG can be described as very cheap.
Compared to the rest of the industry, the Price/Earnings ratio of ECPG indicates a somewhat cheap valuation: ECPG is cheaper than 80.00% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 27.40. ECPG is valued rather cheaply when compared to this.
ECPG is valuated cheaply with a Price/Forward Earnings ratio of 4.91.
Based on the Price/Forward Earnings ratio, ECPG is valued cheaper than 85.45% of the companies in the same industry.
ECPG's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.94.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 5.76 | ||
| Fwd PE | 4.91 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ECPG indicates a somewhat cheap valuation: ECPG is cheaper than 69.09% of the companies listed in the same industry.
The rest of the industry has a similar Price/Free Cash Flow ratio as ECPG.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.95 | ||
| EV/EBITDA | 11.72 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A cheap valuation may be justified as ECPG's earnings are expected to decrease with -19.01% in the coming years.
PEG (NY)0.09
PEG (5Y)N/A
EPS Next 2Y29.13%
EPS Next 3Y-19.01%
5. Dividend
5.1 Amount
No dividends for ECPG!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
41.36
+0.83 (+2.05%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryConsumer Finance
Earnings (Last)
Earnings (Next)
Inst Owners111.35%
Inst Owner Change0.09%
Ins Owners3.03%
Ins Owner Change1.73%
Market Cap951.69M
Analysts81.82
Price Target58.4 (41.2%)
Short Float %7.2%
Short Ratio5.17
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)64.01%
Min EPS beat(2)55.86%
Max EPS beat(2)72.16%
EPS beat(4)2
Avg EPS beat(4)27.05%
Min EPS beat(4)-16.57%
Max EPS beat(4)72.16%
EPS beat(8)3
Avg EPS beat(8)-9.39%
EPS beat(12)3
Avg EPS beat(12)-39.21%
EPS beat(16)7
Avg EPS beat(16)-12.81%
Revenue beat(2)2
Avg Revenue beat(2)7.94%
Min Revenue beat(2)2.83%
Max Revenue beat(2)13.05%
Revenue beat(4)2
Avg Revenue beat(4)-3.7%
Min Revenue beat(4)-30.44%
Max Revenue beat(4)13.05%
Revenue beat(8)3
Avg Revenue beat(8)-6.74%
Revenue beat(12)3
Avg Revenue beat(12)-5.76%
Revenue beat(16)3
Avg Revenue beat(16)-6.14%
PT rev (1m)0%
PT rev (3m)0%
EPS NQ rev (1m)0%
EPS NQ rev (3m)17.3%
EPS NY rev (1m)3.09%
EPS NY rev (3m)22.9%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)4.42%
Revenue NY rev (1m)0%
Revenue NY rev (3m)4.81%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 5.76 | ||
| Fwd PE | 4.91 | ||
| P/S | 0.65 | ||
| P/FCF | 9.95 | ||
| P/OCF | 7.68 | ||
| P/B | 1.06 | ||
| P/tB | 2.7 | ||
| EV/EBITDA | 11.72 |
EPS(TTM)7.18
EY17.36%
EPS(NY)8.42
Fwd EY20.36%
FCF(TTM)4.16
FCFY10.05%
OCF(TTM)5.39
OCFY13.03%
SpS63.78
BVpS38.94
TBVpS15.34
PEG (NY)0.09
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -1.71% | ||
| ROE | -9.91% | ||
| ROCE | 7.46% | ||
| ROIC | 5.89% | ||
| ROICexc | 6.1% | ||
| ROICexgc | 7.05% | ||
| OM | 25.28% | ||
| PM (TTM) | N/A | ||
| GM | 78.54% | ||
| FCFM | 6.52% |
ROA(3y)-1.02%
ROA(5y)1.78%
ROE(3y)-7.9%
ROE(5y)4.66%
ROIC(3y)5.57%
ROIC(5y)6.77%
ROICexc(3y)5.79%
ROICexc(5y)7.05%
ROICexgc(3y)7.27%
ROICexgc(5y)9.12%
ROCE(3y)7.06%
ROCE(5y)8.57%
ROICexcg growth 3Y-19.09%
ROICexcg growth 5Y-10.87%
ROICexc growth 3Y-15.2%
ROICexc growth 5Y-9.09%
OM growth 3Y-11.86%
OM growth 5Y-8.47%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.31%
GM growth 5Y-0.74%
F-Score4
Asset Turnover0.28
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.43 | ||
| Debt/FCF | 41.46 | ||
| Debt/EBITDA | 9.84 | ||
| Cap/Depr | 88.28% | ||
| Cap/Sales | 1.93% | ||
| Interest Coverage | 1.41 | ||
| Cash Conversion | 30.75% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.97 | ||
| Quick Ratio | 0.97 | ||
| Altman-Z | 0.92 |
F-Score4
WACC7.07%
ROIC/WACC0.83
Cap/Depr(3y)74.18%
Cap/Depr(5y)74.01%
Cap/Sales(3y)2.36%
Cap/Sales(5y)2.35%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)187.2%
EPS 3Y-24.04%
EPS 5Y-3.19%
EPS Q2Q%85.82%
EPS Next Y65.87%
EPS Next 2Y29.13%
EPS Next 3Y-19.01%
EPS Next 5YN/A
Revenue 1Y (TTM)13.96%
Revenue growth 3Y-2.39%
Revenue growth 5Y-1.19%
Sales Q2Q%20.45%
Revenue Next Year15.63%
Revenue Next 2Y10.63%
Revenue Next 3Y-22.84%
Revenue Next 5YN/A
EBIT growth 1Y12.32%
EBIT growth 3Y-13.97%
EBIT growth 5Y-9.56%
EBIT Next Year40.24%
EBIT Next 3Y-6.14%
EBIT Next 5YN/A
FCF growth 1Y-31.68%
FCF growth 3Y-22.17%
FCF growth 5Y-9.12%
OCF growth 1Y-29.08%
OCF growth 3Y-19.83%
OCF growth 5Y-8.59%