Encore Capital Group (NASDAQ:ECPG) Reaches New 1-Year High - Time to Buy?

Key Points

• Shares hit a new 52-week high — ECPG traded as high as $79.52 intraday and is above its 50- and 200-day moving averages, with analysts' consensus a "Buy" and an average price target of $75.50 (several firms have raised targets).
• Quarterly results significantly beat expectations — Encore reported $3.37 EPS vs. $2.20 expected and revenue of $473.6M (+78.3% YoY), with a 14.5% net margin and 28.2% ROE; sell-side forecasts about $5.09 EPS for the year.
• Balance-sheet and insider activity are mixed signals — the firm carries high leverage (debt-to-equity 4.10) and a low current ratio (0.68), and an insider sold 7,240 shares in March, trimming their holding by ~13%.

Shares of Encore Capital Group Inc (NASDAQ:ECPG - Get Free Report) reached a new 52-week high during mid-day trading on Wednesday . The company traded as high as $79.52 and last traded at $74.2530, with a volume of 80605 shares trading hands. The stock had previously closed at $73.76.

Analyst Upgrades and Downgrades

A number of equities research analysts have issued reports on ECPG shares. Zacks Research upgraded shares of Encore Capital Group from a "hold" rating to a "strong-buy" rating in a report on Friday, February 27th. Northland Securities set a $70.00 price target on shares of Encore Capital Group in a report on Thursday, January 22nd. Wall Street Zen cut shares of Encore Capital Group from a "strong-buy" rating to a "buy" rating in a research note on Saturday, March 28th. Citigroup reiterated an "outperform" rating on shares of Encore Capital Group in a research note on Tuesday, January 20th. Finally, Truist Financial increased their target price on shares of Encore Capital Group from $59.00 to $80.00 and gave the company a "buy" rating in a research note on Thursday, February 26th. One research analyst has rated the stock with a Strong Buy rating, four have given a Buy rating and one has issued a Hold rating to the stock. Based on data from MarketBeat, the stock has an average rating of "Buy" and a consensus price target of $75.50.

Encore Capital Group Trading Up 0.8%

The company has a debt-to-equity ratio of 4.10, a current ratio of 0.68 and a quick ratio of 0.68. The company's 50 day moving average is $64.33 and its two-hundred day moving average is $54.75. The firm has a market cap of $1.59 billion, a P/E ratio of 6.77 and a beta of 1.26.

Encore Capital Group (NASDAQ:ECPG - Get Free Report) last posted its quarterly earnings data on Wednesday, February 25th. The asset manager reported $3.37 earnings per share for the quarter, topping the consensus estimate of $2.20 by $1.17. The company had revenue of $473.55 million during the quarter, compared to analyst estimates of $423.14 million. Encore Capital Group had a net margin of 14.52% and a return on equity of 28.19%. The company's revenue was up 78.3% on a year-over-year basis. During the same quarter last year, the business posted ($9.42) earnings per share. On average, sell-side analysts predict that Encore Capital Group Inc will post 5.09 earnings per share for the current year.

Insider Activity at Encore Capital Group

In other news, insider Ryan B. Bell sold 7,240 shares of the business's stock in a transaction that occurred on Monday, March 2nd. The stock was sold at an average price of $69.04, for a total value of $499,849.60. Following the transaction, the insider directly owned 48,170 shares of the company's stock, valued at $3,325,656.80. The trade was a 13.07% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. 2.63% of the stock is owned by insiders.

Institutional Inflows and Outflows

Institutional investors and hedge funds have recently modified their holdings of the business. IFP Advisors Inc boosted its holdings in shares of Encore Capital Group by 1,729.6% in the 4th quarter. IFP Advisors Inc now owns 494 shares of the asset manager's stock worth $27,000 after acquiring an additional 467 shares in the last quarter. EverSource Wealth Advisors LLC boosted its holdings in shares of Encore Capital Group by 185.7% in the 4th quarter. EverSource Wealth Advisors LLC now owns 717 shares of the asset manager's stock worth $39,000 after acquiring an additional 466 shares in the last quarter. Allworth Financial LP boosted its holdings in shares of Encore Capital Group by 29.1% in the 4th quarter. Allworth Financial LP now owns 1,139 shares of the asset manager's stock worth $62,000 after acquiring an additional 257 shares in the last quarter. LSV Asset Management acquired a new position in shares of Encore Capital Group in the 3rd quarter worth approximately $88,000. Finally, Tower Research Capital LLC TRC boosted its holdings in shares of Encore Capital Group by 168.9% in the 2nd quarter. Tower Research Capital LLC TRC now owns 2,716 shares of the asset manager's stock worth $105,000 after acquiring an additional 1,706 shares in the last quarter.

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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