FirstCash (NASDAQ:FCFS) Releases Quarterly Earnings Results, Beats Expectations By $0.05 EPS

FirstCash (NASDAQ:FCFS) posted its quarterly earnings data on Thursday. The company reported $2.68 earnings per share for the quarter, beating the consensus estimate of $2.63 by $0.05, Zacks reports. The business had revenue of $1.10 billion during the quarter, compared to the consensus estimate of $1.07 billion. FirstCash had a return on equity of 19.65% and a net margin of 9.42%. The company’s revenue was up 17.7% compared to the same quarter last year. During the same period in the prior year, the company earned $1.86 earnings per share.

FirstCash Trading Down 14.7%

NASDAQ FCFS opened at $184.78 on Friday. The stock has a market capitalization of $8.01 billion, a P/E ratio of 21.09 and a beta of 0.55. FirstCash has a 52-week low of $146.77 and a 52-week high of $238.93. The firm has a 50-day moving average price of $217.31 and a 200 day moving average price of $216.31. The company has a quick ratio of 3.51, a current ratio of 4.89 and a debt-to-equity ratio of 1.01.

FirstCash Increases Dividend

The company also recently declared a quarterly dividend, which will be paid on Tuesday, November 24th. Investors of record on Friday, November 13th will be issued a dividend of $0.46 per share. This is an increase from FirstCash’s previous quarterly dividend of $0.42. This represents a $1.84 annualized dividend and a yield of 1.0%. The ex-dividend date of this dividend is Friday, November 13th. FirstCash’s dividend payout ratio is currently 19.18%.

Insider Activity

In other news, insider Howard Hambleton sold 2,000 shares of the firm’s stock in a transaction that occurred on Tuesday, August 18th. The stock was sold at an average price of $212.98, for a total value of $425,960.00. Following the completion of the sale, the insider directly owned 30,406 shares of the company’s stock, valued at $6,475,869.88. This trade represents a 6.17% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director James Graves sold 3,750 shares of the firm’s stock in a transaction that occurred on Thursday, September 3rd. The shares were sold at an average price of $221.20, for a total value of $829,500.00. Following the completion of the sale, the director directly owned 11,929 shares of the company’s stock, valued at $2,638,694.80. This represents a 23.92% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders have sold 14,098 shares of company stock worth $3,051,281 in the last three months. 2.86% of the stock is currently owned by company insiders.

Wall Street Analyst Weigh In

A number of equities analysts have recently commented on the stock. Weiss Ratings raised shares of FirstCash from a “buy (b)” rating to a “buy (b+)” rating in a report on Thursday, October 8th. Loop Capital raised shares of FirstCash from a “hold” rating to a “buy” rating and set a $255.00 price objective on the stock in a research report on Monday, August 10th. TD Cowen lifted their price objective on shares of FirstCash from $240.00 to $242.00 and gave the company a “buy” rating in a research note on Tuesday, October 6th. Canaccord Genuity Group lifted their price objective on shares of FirstCash from $252.00 to $265.00 and gave the company a “buy” rating in a research note on Thursday, October 15th. Finally, Wall Street Zen cut shares of FirstCash from a “buy” rating to a “hold” rating in a report on Saturday, October 10th. Five equities research analysts have rated the stock with a Buy rating and one has assigned a Hold rating to the company’s stock. According to MarketBeat, the company has an average rating of “Moderate Buy” and an average target price of $253.00.

Key FirstCash News

Here are the key news stories impacting FirstCash this week:

• Positive Sentiment: FirstCash reported record third-quarter revenue of $1.10 billion, up 17.7% year over year, while adjusted EPS of $2.68 exceeded the $2.63 consensus estimate. Net income rose 22% to $101 million and adjusted EBITDA increased 18% to $213 million. FirstCash Reports Record Third Quarter Operating Results
• Positive Sentiment: The core pawn business remained strong: revenue and segment earnings grew 28%, pawn receivables reached a record $908 million, and FirstCash added 14 stores during the quarter, bringing year-to-date additions to 42.
• Positive Sentiment: Management raised the quarterly dividend 9.5% to $0.46 per share and repurchased $123 million of stock in the quarter, bringing year-to-date buybacks to $250 million. The company also maintained a positive outlook for continued double-digit pawn growth and margin expansion.
• Neutral Sentiment: Investors are assessing whether the pawn division’s momentum can continue, particularly as FirstCash prepares to lap prior acquisitions and seeks regulatory approval to complete the proposed Ramsdens acquisition, which would add more than 175 U.K. locations. Can FirstCash Keep Its Pawn Business Momentum?
• Negative Sentiment: American First Finance remains a drag. Third-quarter gross transaction volume fell 15%, net revenue declined 20% and segment operating income decreased because of merchant bankruptcies and weakness in furniture and other discretionary retail. Management expects fourth-quarter net revenue to decline 15% to 20%.
• Negative Sentiment: The Law Offices of Frank R. Cruz announced an investigation into potential securities-law violations related to FirstCash disclosures. The announcement does not establish wrongdoing, but it adds legal and reputational uncertainty following the sharp selloff. Law Offices of Frank R. Cruz Investigation

About FirstCash

FirstCash Holdings, Inc is a specialty financial services and retail company that operates pawn stores in the United States and Mexico. Through its pawn operations, the company provides short-term, collateral-backed loans to consumers who pledge personal property as security. Customers can reclaim their pledged items by repaying the loan and applicable fees within the required period.

The company also generates revenue by selling merchandise that has been forfeited on pawn loans or acquired through other purchasing activities.