Why Portfolio Recovery Is Poised to Keep Rallying

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, bad-debt collector Portfolio Recovery Associates (NASDAQ: PRAA  ) has earned a coveted five-star ranking.

With that in mind, let's take a closer look at Portfolio Recovery and see what CAPS investors are saying about the stock right now.

Portfolio Recovery facts

Headquarters (founded)

Norfolk, Va. (1996)

Market Cap

$1.9 billion

Industry

Consumer finance

Trailing-12-Month Revenue

$556.6 million

Management

Co-Founder/Chairman/CEO Steven Fredrickson
Co-Founder/CFO Kevin Stevenson

Return on Equity (average, past 3 years)

17.5%

Cash / Debt

$31.5 million / $250.7 million

Competitors

Asta Funding (NASDAQ: ASFI  ) GC Services Limited Partnership
NCO Group

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 97% of the 3,114 members who have rated Portfolio Recovery believe the stock will outperform the S&P 500 going forward.

Just last week, one of those Fools, talkingmonkey, succinctly summed up the Portfolio Recovery bull case for our community:

[A]s long as there are people who can't or won't pay their bills and manage their debt, there will be a need for companies like [Portfolio Recovery]. All of them chomping at the bit for the chance to make a tidy profit by trolling for dollars. Call it a necessary evil. I still don't like 'em. But they are profitable. And you know what "they" say: If [you] can't beat 'em with a giant stick, you might as well follow them around and pick up the change that's spilling out of their pockets. OK, fine, "they" never said that, but the logic is sound.

If you want market-topping returns, you need to put together the best portfolio you can. Of course, despite its five-star rating, Portfolio Recovery may not be your top choice.

We've found another stock we are incredibly excited about -- excited enough to dub it "The Motley Fool's Top Stock for 2013." We have compiled a special free report for investors to uncover this stock today. The report is 100% free, but it won't be here forever, so click here to access it now.

Want to see how well (or not so well) the stocks in this series are performing? Follow the TrackPoisedTo CAPS account.


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