In spite of all the doomsayers out there, payday loan companies, pawn shops, and car title loan companies are doing just fine thank you.
Zack’s Investment Research correspondent Tracey Ryniec wrote an interesting analysis of EZPWN recently. Basically she says, “EZCORP, Inc. (EZPW) is riding high as the pawnshop business booms during the economic slowdown. The company recently acquired an additional 67 pawnshops to expand its reach in Florida. EZPW is trading at 10.18x forward earnings.”
As many of our readers know, EZCORP operates payday loan stores and pawnshops in the U.S. and Mexico. EZCORP has 890 locations, including 412 pawnshops, with 371 in the U.S. and 41 in Mexico, and 478 loan stores in the U.S.
Ms. Ryniec goes on to write,
“Revenue Jumped 23% in Fiscal 2008
On Nov 6, EZCORP announced fourth-quarter and 2008 full-year earnings that met Wall Street estimates. For the fourth quarter, net income rose 44% to $16 million from $11 million in the year ago period.
Revenue grew 19% to $123 million. The pawn operations were the engine of growth in the quarter. It was the 25th consecutive quarter of year-over-year earnings growth.
Fiscal 2008 net income climbed 38% to $52.43 million, or $1.21 per share, from $37.87 million, or 88 cents per share, for the 2007 period. Revenue rose 23% to $457 million.
First-Quarter and Full-Year 2009 Guidance
EZCORP issued first quarter 2009 and full-year earnings forecast of 35 cents and $1.45 per share, respectively. The company is scheduled to report first-quarter earnings on Jan 22.”
She sums up,
“Full-year 2009 estimates, however, have risen 5 cents to $1.50 over the same period, which is higher than the company’s guidance. Analysts expect 2009 year-over-year earnings growth of 25.84%.”
One thing that amazed us was the following:
“EZCORP also closed on a $120 million credit facility, consisting of a $40 million term loan and an $80 million revolving line of credit. As of the closing, the company only borrowed $40 million, leaving $80 million of the credit line available for future use.”
No problems with access to capital experienced in this industry!
Read the article in it’s entirety here: Zack’s Investment Research
We HIGHLY recommend you listen to EZCORP’s conference call scheduled for January 22, 2009. Go here PaydayLoanIndustry.com and scroll to the very bottom to get to their link to the investors page where you can sign up free. This is a MUST!