FirstCash (NASDAQ:FCFS) to Buy Back $200 million in Stock

Key Points

• FirstCash approved a $200 million share repurchase program, allowing it to buy back up to 2.4% of outstanding shares through open-market purchases.
• The company reported stronger-than-expected quarterly results, with EPS of $2.68 versus the $2.63 consensus and revenue of $1.10 billion, up 17.7% year over year.
• FirstCash increased its quarterly dividend to $0.46 per share, raising the annualized payout to $1.84 and the yield to approximately 1.0%; analysts maintain a “Moderate Buy” consensus with a $247.50 average price target.

FirstCash (NASDAQ:FCFS - Get Free Report) announced that its Board of Directors has approved a share repurchase plan on Wednesday, October 28th, RTT News reports. The company plans to buy back $200 million in shares. This repurchase authorization permits the company to buy up to 2.4% of its shares through open market purchases. Stock repurchase plans are usually an indication that the company's management believes its stock is undervalued.

FirstCash Stock Up 2.5%

Shares of FirstCash stock traded up $4.67 during trading hours on Wednesday, reaching $190.02. 1,144,429 shares of the company's stock were exchanged, compared to its average volume of 398,036. The company has a 50 day moving average of $214.39 and a two-hundred day moving average of $205.68. FirstCash has a fifty-two week low of $146.77 and a fifty-two week high of $238.93. The company has a current ratio of 4.81, a quick ratio of 3.42 and a debt-to-equity ratio of 1.08. The stock has a market cap of $8.24 billion, a P/E ratio of 20.59 and a beta of 0.55.

FirstCash (NASDAQ:FCFS - Get Free Report) last released its earnings results on Thursday, October 22nd. The company reported $2.68 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $2.63 by $0.05. FirstCash had a return on equity of 20.17% and a net margin of 9.48%. The business had revenue of $1.10 billion for the quarter, compared to the consensus estimate of $1.07 billion. During the same quarter in the previous year, the business earned $1.86 earnings per share. FirstCash's quarterly revenue was up 17.7% on a year-over-year basis. On average, sell-side analysts forecast that FirstCash will post 11.03 EPS for the current fiscal year.

FirstCash Increases Dividend

The business also recently declared a quarterly dividend, which will be paid on Tuesday, November 24th. Investors of record on Friday, November 13th will be given a dividend of $0.46 per share. This represents a $1.84 annualized dividend and a yield of 1.0%. This is a boost from FirstCash's previous quarterly dividend of $0.42. The ex-dividend date of this dividend is Friday, November 13th. FirstCash's payout ratio is currently 18.20%.

Analyst Ratings Changes

FCFS has been the subject of a number of research reports. TD Cowen decreased their price objective on FirstCash from $242.00 to $235.00 and set a "buy" rating for the company in a report on Friday, October 23rd. Canaccord Genuity Group reduced their price target on FirstCash from $265.00 to $250.00 and set a "buy" rating for the company in a research report on Friday, October 23rd. Weiss Ratings cut shares of FirstCash from a "buy (b+)" rating to a "buy (b)" rating in a research note on Friday, October 23rd. Stephens reiterated an "overweight" rating and issued a $250.00 price objective on shares of FirstCash in a report on Thursday, October 1st. Finally, 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. Five equities research analysts have rated the stock with a Buy rating and one has given a Hold rating to the company. According to MarketBeat.com, the company presently has an average rating of "Moderate Buy" and an average target price of $247.50.

Insider Buying and Selling

In other FirstCash news, Director James Graves sold 3,750 shares of the business's stock in a transaction that occurred on Thursday, September 3rd. The stock was sold at an average price of $221.20, for a total transaction of $829,500.00. Following the transaction, the director owned 11,929 shares of the company's stock, valued at $2,638,694.80. The trade was a 23.92% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available through this link. Also, insider Howard Hambleton sold 2,000 shares of the business'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 transaction, the insider directly owned 30,406 shares in the company, valued at $6,475,869.88. This trade represents a 6.17% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold 14,098 shares of company stock valued at $3,051,281 in the last ninety days. 2.86% of the stock is owned by company insiders.

FirstCash Company Profile

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.

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