Encore Capital Group
The 10-second takeaway
For the quarter ended March 31 (Q1), Encore Capital Group met expectations on revenue and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue improved significantly and GAAP earnings per share contracted significantly.
Gross margin improved, operating margin expanded, and net margin shrank.
Encore Capital Group chalked up revenue of $130.2 million. The six analysts polled by S&P Capital IQ wanted to see revenue of $130.1 million on the same basis. GAAP reported sales were 18% higher than the prior-year quarter's $110.3 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.44. The six earnings estimates compiled by S&P Capital IQ anticipated $0.66 per share. GAAP EPS of $0.44 for Q1 were 19% lower than the prior-year quarter's $0.54 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 82.3%, 120 basis points better than the prior-year quarter. Operating margin was 26.4%, 120 basis points better than the prior-year quarter. Net margin was 8.8%, 360 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $134.4 million. On the bottom line, the average EPS estimate is $0.70.
Next year's average estimate for revenue is $537.1 million. The average EPS estimate is $2.89.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 88 members out of 98 rating the stock outperform, and 10 members rating it underperform. Among 31 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 30 give Encore Capital Group a green thumbs-up, and one gives it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Encore Capital Group is outperform, with an average price target of $36.50.
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