PRA Group (NASDAQ:PRAA) Shares Gap Down – Should You Sell?

PRA Group, Inc. (NASDAQ:PRAA) gapped down before the market opened on Wednesday. The stock had previously closed at $20.05, but opened at $19.33. PRA Group shares last traded at $19.4250, with a volume of 19,714 shares.

Key Stories Impacting PRA Group

Here are the key news stories impacting PRA Group this week:

• Positive Sentiment: PRA Group priced a $400 million offering of 8.500% senior notes due 2033. The proceeds are expected to help repay borrowings under its revolving credit facility, extending maturities and reducing near-term refinancing and floating-rate risk. PRA Group Announces Pricing of Offering of $400.0 Million of 8.500% Senior Notes due 2033
• Positive Sentiment: An investment analysis rated PRAA a “Buy,” citing resilient credit collections—particularly in Europe—disciplined loan purchases, improving nonperforming-loan pricing and a substantial discount to book value. The analysis also noted leverage of approximately 2.7x and strong labor markets that could support future cash recoveries. PRA Group: Outsized Discount to Book Value Given Resilient Recoveries
• Neutral Sentiment: Sell-side brokerages assigned PRA Group a “Hold” rating, indicating that some analysts remain cautious despite the recent operational and financing improvements. PRA Group Stock Now Rated Hold by Sell-Side Brokerages
• Negative Sentiment: The new notes carry an 8.500% coupon, which is expensive and could keep interest costs elevated. Investors may therefore weigh the benefits of longer maturities and improved liquidity against the potential pressure on earnings and cash flow from higher financing costs. PRA Group Announces Pricing of Offering of $400 Million of 8.500% Senior Notes Due 2033

Analysts Set New Price Targets

Several research firms have recently issued reports on PRAA. Zacks Research raised PRA Group from a “hold” rating to a “strong-buy” rating in a research note on Monday, August 10th. Wall Street Zen upgraded PRA Group from a “buy” rating to a “strong-buy” rating in a research note on Saturday. Finally, Weiss Ratings reaffirmed a “sell (d)” rating on shares of PRA Group in a report on Monday, September 21st. One equities research analyst has rated the stock with a Strong Buy rating, one has given a Buy rating, two have assigned a Hold rating and one has issued a Sell rating to the company. According to MarketBeat.com, PRA Group has an average rating of “Hold” and an average target price of $26.00.

PRA Group Trading Down 0.8%

The company has a market cap of $726.27 million, a P/E ratio of -2.87 and a beta of 1.11. The company’s 50-day moving average price is $19.06 and its two-hundred day moving average price is $18.13.

PRA Group (NASDAQ:PRAA) last announced its earnings results on Thursday, August 6th. The business services provider reported $1.51 EPS for the quarter, beating the consensus estimate of $0.52 by $0.99. The business had revenue of $372.17 million during the quarter, compared to the consensus estimate of $299.99 million. PRA Group had a positive return on equity of 15.56% and a negative net margin of 19.91%. Equities analysts forecast that PRA Group, Inc. will post 3.93 earnings per share for the current year.

Institutional Trading of PRA Group

Large investors have recently modified their holdings of the company. WINTON GROUP Ltd acquired a new stake in shares of PRA Group in the second quarter worth $281,000. Squarepoint Ops LLC raised its position in PRA Group by 68.1% in the second quarter. Squarepoint Ops LLC now owns 99,824 shares of the business services provider’s stock worth $1,896,000 after purchasing an additional 40,439 shares in the last quarter. AXQ Capital LP bought a new position in PRA Group during the second quarter worth about $263,000. Headlands Technologies LLC lifted its stake in PRA Group by 34.0% during the second quarter. Headlands Technologies LLC now owns 16,490 shares of the business services provider’s stock worth $313,000 after purchasing an additional 4,185 shares during the period. Finally, Susquehanna International Group LLP boosted its holdings in PRA Group by 288.0% during the second quarter. Susquehanna International Group LLP now owns 200,848 shares of the business services provider’s stock valued at $3,814,000 after purchasing an additional 149,078 shares in the last quarter. 97.22% of the stock is owned by institutional investors.

PRA Group Company Profile

PRA Group, Inc is a global financial services company that purchases portfolios of accounts receivable from banks, credit unions, consumer finance companies and other creditors. These portfolios generally consist of nonperforming or distressed consumer accounts, including unpaid credit card balances, personal loans and other forms of unsecured debt.

After acquiring receivables, PRA Group works directly with consumers to establish repayment arrangements and resolve outstanding obligations.