Encore Capital Group (NASDAQ:ECPG) Issues Earnings Results, Beats Expectations By $0.14 EPS

Key Points

• Encore Capital beat quarterly expectations, reporting EPS of $2.81 versus the $2.67 consensus and revenue of $491.87 million, up 11.3% year over year.
• Record portfolio purchases and collections strengthened performance, with global purchases reaching $444 million and collections rising 13% to $737 million. Management raised 2026 collections guidance to $2.8–$2.85 billion and maintained EPS guidance of $13–$14.
• The company completed a $1 billion refinancing expected to save approximately $50 million in annual interest expense, while shares fell 3.0% in Wednesday trading to $92.69.

Encore Capital Group (NASDAQ:ECPG - Get Free Report) released its quarterly earnings results on Wednesday. The asset manager reported $2.81 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $2.67 by $0.14, FiscalAI reports. Encore Capital Group had a net margin of 16.00% and a return on equity of 30.70%. The firm had revenue of $491.87 million for the quarter, compared to analysts' expectations of $455.10 million. During the same quarter last year, the company earned $2.49 EPS. The firm's revenue for the quarter was up 11.3% compared to the same quarter last year. Encore Capital Group updated its FY 2026 guidance to 13.000-14.000 EPS.

Here are the key takeaways from Encore Capital Group's conference call:

• Record U.S. portfolio purchases and global collections supported strong quarterly performance: global purchases reached $444 million, including a record $372 million in the U.S., while collections rose 13% to a record $737 million.
• Collections outperformance and operational improvements drove leverage, with cash efficiency margin increasing to 60.2%, ROIC rising to 14.7%, and leverage improving to 2.3 times from 2.6 times a year ago.
• Management raised 2026 global collections guidance to $2.8 billion-$2.85 billion and expects portfolio purchases near the high end of the $1.4 billion-$1.5 billion range; full-year EPS guidance is $13-$14 despite $1 per share of refinancing costs in Q2.
• The company completed a billion-dollar refinancing at lower coupons, expects approximately $50 million in annualized interest savings, and reported no material maturities until 2028, providing additional financial flexibility.
• Cabot’s European business remained stable, with collections flat year over year at $164 million, but management continues to be selective in the U.K. amid subdued consumer lending, low delinquencies, and robust competition.

Encore Capital Group Trading Down 3.0%

Shares of NASDAQ ECPG traded down $2.85 during trading on Wednesday, hitting $92.69. 339,170 shares of the company were exchanged, compared to its average volume of 329,619. Encore Capital Group has a 12-month low of $36.24 and a 12-month high of $98.15. The company has a debt-to-equity ratio of 3.90, a quick ratio of 0.90 and a current ratio of 0.90. The company has a fifty day moving average price of $87.53 and a 200-day moving average price of $76.04. The firm has a market capitalization of $1.99 billion, a PE ratio of 7.19 and a beta of 1.27.

Wall Street Analyst Weigh In

A number of equities research analysts have recently issued reports on ECPG shares. Wall Street Zen lowered shares of Encore Capital Group from a "strong-buy" rating to a "hold" rating in a report on Saturday, May 9th. Citizens Jmp boosted their price target on shares of Encore Capital Group from $108.00 to $115.00 and gave the stock a "market outperform" rating in a research report on Wednesday, June 17th. Citigroup reaffirmed a "market outperform" rating on shares of Encore Capital Group in a research note on Wednesday, June 17th. Zacks Research downgraded shares of Encore Capital Group from a "strong-buy" rating to a "hold" rating in a report on Monday, July 6th. Finally, Weiss Ratings raised shares of Encore Capital Group from a "hold (c)" rating to a "buy (b-)" rating in a research note on Monday. Five analysts have rated the stock with a Buy rating and one has given a Hold rating to the company. According to data from MarketBeat, Encore Capital Group presently has a consensus rating of "Moderate Buy" and a consensus price target of $88.00.

Insider Activity

In related news, insider John Yung sold 2,000 shares of the company's stock in a transaction dated Wednesday, June 10th. The shares were sold at an average price of $82.08, for a total value of $164,160.00. Following the completion of the sale, the insider owned 64,570 shares of the company's stock, valued at approximately $5,299,905.60. This represents a 3.00% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which can be accessed through this link. Corporate insiders own 3.00% of the company's stock.

Institutional Trading of Encore Capital Group

A number of hedge funds and other institutional investors have recently modified their holdings of the business. Tower Research Capital LLC TRC boosted its holdings in Encore Capital Group by 168.9% during the 2nd quarter. Tower Research Capital LLC TRC now owns 2,716 shares of the asset manager's stock valued at $105,000 after acquiring an additional 1,706 shares during the period. Virtus Advisers LLC purchased a new position in Encore Capital Group in the third quarter valued at $143,000. Virtu Financial LLC purchased a new position in Encore Capital Group in the fourth quarter valued at $201,000. Brooklyn Investment Group acquired a new position in Encore Capital Group during the 4th quarter worth $211,000. Finally, Mercer Global Advisors Inc. ADV purchased a new position in shares of Encore Capital Group in the 3rd quarter valued at about $214,000.

About Encore Capital Group

Encore Capital Group, Inc is a global specialty finance company that focuses on the purchase and management of nonperforming consumer receivables. Through its subsidiaries, the company acquires charged-off debt portfolios from credit card issuers, banks, and other financial institutions, and seeks to recover outstanding balances through a combination of customer outreach, payment arrangements, and, where appropriate, legal collection efforts. Encore's business model emphasizes compliance with regulatory and industry standards to ensure ethical and transparent debt-recovery practices.

Headquartered in San Diego, California, Encore operates across North America and Europe.

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