ENCORE CAPITAL GROUP INC (ECPG)

US2925541029 - Common Stock

47.52  +0.76 (+1.63%)

After market: 47.52 0 (0%)

Fundamental Rating

4

ECPG gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 52 industry peers in the Consumer Finance industry. While ECPG is still in line with the averages on profitability rating, there are concerns on its financial health. ECPG is not valued too expensively and it also shows a decent growth rate.



4

1. Profitability

1.1 Basic Checks

ECPG had positive earnings in the past year.
ECPG had a positive operating cash flow in the past year.
Of the past 5 years ECPG 4 years were profitable.
In the past 5 years ECPG always reported a positive cash flow from operatings.

1.2 Ratios

With a Return On Assets value of -3.70%, ECPG is not doing good in the industry: 82.69% of the companies in the same industry are doing better.
ECPG has a Return On Equity of -17.62%. This is amonst the worse of the industry: ECPG underperforms 80.77% of its industry peers.
ECPG has a better Return On Invested Capital (4.51%) than 63.46% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for ECPG is below the industry average of 7.32%.
Industry RankSector Rank
ROA -3.7%
ROE -17.62%
ROIC 4.51%
ROA(3y)2.49%
ROA(5y)3.05%
ROE(3y)8.01%
ROE(5y)11.57%
ROIC(3y)5.24%
ROIC(5y)5.83%

1.3 Margins

With an excellent Operating Margin value of 25.88%, ECPG belongs to the best of the industry, outperforming 84.62% of the companies in the same industry.
In the last couple of years the Operating Margin of ECPG has declined.
With a decent Gross Margin value of 79.04%, ECPG is doing good in the industry, outperforming 73.08% of the companies in the same industry.
ECPG's Gross Margin has been stable in the last couple of years.
Industry RankSector Rank
OM 25.88%
PM (TTM) N/A
GM 79.04%
OM growth 3Y-14.05%
OM growth 5Y-5.55%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.8%
GM growth 5Y-0.67%

3

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so ECPG 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 1.00. This is a bad value and indicates that ECPG is not financially healthy and even has some risk of bankruptcy.
The Altman-Z score of ECPG (1.00) is better than 63.46% of its industry peers.
The Debt to FCF ratio of ECPG is 25.19, which is on the high side as it means it would take ECPG, 25.19 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 25.19, ECPG is doing worse than 63.46% of the companies in the same industry.
ECPG has a Debt/Equity ratio of 3.39. This is a high value indicating a heavy dependency on external financing.
ECPG has a Debt to Equity ratio (3.39) which is in line with its industry peers.
Industry RankSector Rank
Debt/Equity 3.39
Debt/FCF 25.19
Altman-Z 1
ROIC/WACC0.73
WACC6.21%

2.3 Liquidity

ECPG has a Current Ratio of 1.33. This is a normal value and indicates that ECPG is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of ECPG (1.33) is comparable to the rest of the industry.
ECPG has a Quick Ratio of 1.33. This is a normal value and indicates that ECPG is financially healthy and should not expect problems in meeting its short term obligations.
With a Quick ratio value of 1.33, ECPG perfoms like the industry average, outperforming 55.77% of the companies in the same industry.
Industry RankSector Rank
Current Ratio 1.33
Quick Ratio 1.33

5

3. Growth

3.1 Past

ECPG shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 706.12%, which is quite impressive.
Measured over the past years, ECPG shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -16.25% on average per year.
Looking at the last year, ECPG shows a small growth in Revenue. The Revenue has grown by 2.53% in the last year.
ECPG shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -2.14% yearly.
EPS 1Y (TTM)706.12%
EPS 3Y-35.94%
EPS 5Y-16.25%
EPS Q2Q%59.49%
Revenue 1Y (TTM)2.53%
Revenue growth 3Y-6.47%
Revenue growth 5Y-2.14%
Sales Q2Q%39.91%

3.2 Future

The Earnings Per Share is expected to grow by 93.08% on average over the next years. This is a very strong growth
Based on estimates for the next years, ECPG will show a quite strong growth in Revenue. The Revenue will grow by 12.54% on average per year.
EPS Next Y148.6%
EPS Next 2Y93.08%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year11.52%
Revenue Next 2Y12.54%
Revenue Next 3YN/A
Revenue Next 5YN/A

3.3 Evolution

The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.

6

4. Valuation

4.1 Price/Earnings Ratio

ECPG is valuated correctly with a Price/Earnings ratio of 16.00.
ECPG's Price/Earnings ratio is in line with the industry average.
When comparing the Price/Earnings ratio of ECPG to the average of the S&P500 Index (27.54), we can say ECPG is valued slightly cheaper.
Based on the Price/Forward Earnings ratio of 6.25, the valuation of ECPG can be described as very cheap.
ECPG's Price/Forward Earnings ratio is rather cheap when compared to the industry. ECPG is cheaper than 80.77% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of ECPG to the average of the S&P500 Index (23.99), we can say ECPG is valued rather cheaply.
Industry RankSector Rank
PE 16
Fwd PE 6.25

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, ECPG is valued a bit cheaper than 71.15% of the companies in the same industry.
The rest of the industry has a similar Price/Free Cash Flow ratio as ECPG.
Industry RankSector Rank
P/FCF 7.99
EV/EBITDA 11.78

4.3 Compensation for Growth

ECPG's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
ECPG's earnings are expected to grow with 93.08% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.11
PEG (5Y)N/A
EPS Next 2Y93.08%
EPS Next 3YN/A

0

5. Dividend

5.1 Amount

No dividends for ECPG!.
Industry RankSector Rank
Dividend Yield N/A

ENCORE CAPITAL GROUP INC

NASDAQ:ECPG (12/24/2024, 8:07:43 PM)

After market: 47.52 0 (0%)

47.52

+0.76 (+1.63%)

Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryConsumer Finance
Earnings (Last)11-06 2024-11-06/amc
Earnings (Next)02-19 2025-02-19/amc
Inst Owners111.78%
Inst Owner Change1.14%
Ins Owners2.42%
Ins Owner Change-0.12%
Market Cap1.13B
Analysts81.82
Price Target63.5 (33.63%)
Short Float %6.37%
Short Ratio9.93
Dividend
Industry RankSector Rank
Dividend Yield N/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-5.48%
Min EPS beat(2)-16.57%
Max EPS beat(2)5.6%
EPS beat(4)1
Avg EPS beat(4)-39.61%
Min EPS beat(4)-146.23%
Max EPS beat(4)5.6%
EPS beat(8)1
Avg EPS beat(8)-70.33%
EPS beat(12)4
Avg EPS beat(12)-29.93%
EPS beat(16)7
Avg EPS beat(16)-15.88%
Revenue beat(2)1
Avg Revenue beat(2)0.21%
Min Revenue beat(2)-0.23%
Max Revenue beat(2)0.65%
Revenue beat(4)1
Avg Revenue beat(4)-5.01%
Min Revenue beat(4)-17.77%
Max Revenue beat(4)0.65%
Revenue beat(8)1
Avg Revenue beat(8)-6.64%
Revenue beat(12)1
Avg Revenue beat(12)-6.54%
Revenue beat(16)1
Avg Revenue beat(16)-6.12%
PT rev (1m)2.05%
PT rev (3m)4.62%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-23.44%
EPS NY rev (1m)-1.78%
EPS NY rev (3m)-11.83%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.4%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.35%
Valuation
Industry RankSector Rank
PE 16
Fwd PE 6.25
P/S 0.85
P/FCF 7.99
P/OCF 6.64
P/B 1.07
P/tB 2.68
EV/EBITDA 11.78
EPS(TTM)2.97
EY6.25%
EPS(NY)7.61
Fwd EY16%
FCF(TTM)5.95
FCFY12.52%
OCF(TTM)7.15
OCFY15.05%
SpS56.06
BVpS44.24
TBVpS17.73
PEG (NY)0.11
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA -3.7%
ROE -17.62%
ROCE 7.2%
ROIC 4.51%
ROICexc 4.75%
ROICexgc 5.77%
OM 25.88%
PM (TTM) N/A
GM 79.04%
FCFM 10.61%
ROA(3y)2.49%
ROA(5y)3.05%
ROE(3y)8.01%
ROE(5y)11.57%
ROIC(3y)5.24%
ROIC(5y)5.83%
ROICexc(3y)5.45%
ROICexc(5y)6.08%
ROICexgc(3y)7.16%
ROICexgc(5y)7.96%
ROCE(3y)8.37%
ROCE(5y)9.32%
ROICexcg growth 3Y-20.41%
ROICexcg growth 5Y-8.75%
ROICexc growth 3Y-18.55%
ROICexc growth 5Y-7.63%
OM growth 3Y-14.05%
OM growth 5Y-5.55%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.8%
GM growth 5Y-0.67%
F-Score3
Asset Turnover0.27
Health
Industry RankSector Rank
Debt/Equity 3.39
Debt/FCF 25.19
Debt/EBITDA 9.44
Cap/Depr 87.82%
Cap/Sales 2.14%
Interest Coverage 1.88
Cash Conversion 45.05%
Profit Quality N/A
Current Ratio 1.33
Quick Ratio 1.33
Altman-Z 1
F-Score3
WACC6.21%
ROIC/WACC0.73
Cap/Depr(3y)66.59%
Cap/Depr(5y)75.44%
Cap/Sales(3y)2.41%
Cap/Sales(5y)2.48%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)706.12%
EPS 3Y-35.94%
EPS 5Y-16.25%
EPS Q2Q%59.49%
EPS Next Y148.6%
EPS Next 2Y93.08%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)2.53%
Revenue growth 3Y-6.47%
Revenue growth 5Y-2.14%
Sales Q2Q%39.91%
Revenue Next Year11.52%
Revenue Next 2Y12.54%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y-1.13%
EBIT growth 3Y-19.61%
EBIT growth 5Y-7.57%
EBIT Next Year34.49%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-34.65%
FCF growth 3Y-22.77%
FCF growth 5Y1.45%
OCF growth 1Y-31.13%
OCF growth 3Y-21.22%
OCF growth 5Y-3.91%