PRA Group (NASDAQ:PRAA) Shares Gap Up on Earnings Beat

Key Points

• PRA Group shares saw a significant increase, opening at $18.57 after closing at $15.63, following a better-than-expected earnings report of $1.08 earnings per share versus a consensus estimate of $0.62.
• Several brokerages have made recent updates on PRA Group, including a downgrade by Wall Street Zen from "hold" to "sell" and an increase in target price by JMP Securities to $24.00 with a "market outperform" rating.
• Director Brett Lee Paschke purchased 5,000 shares at an average price of $13.39, increasing his ownership by nearly 20%, indicating insider confidence in the stock.

PRA Group, Inc. (NASDAQ:PRAA - Get Free Report)'s stock price gapped up before the market opened on Tuesday following a better than expected earnings announcement. The stock had previously closed at $15.63, but opened at $18.57. PRA Group shares last traded at $16.32, with a volume of 80,131 shares changing hands.

The business services provider reported $1.08 EPS for the quarter, beating the consensus estimate of $0.62 by $0.46. PRA Group had a net margin of 8.10% and a return on equity of 6.52%. The company had revenue of $287.69 million for the quarter, compared to analyst estimates of $279.34 million.

Analysts Set New Price Targets

Several equities research analysts recently commented on the company. Citigroup reissued an "outperform" rating on shares of PRA Group in a report on Tuesday. JMP Securities set a $24.00 target price on PRA Group and gave the stock a "market outperform" rating in a report on Tuesday. Finally, Wall Street Zen raised PRA Group from a "sell" rating to a "hold" rating in a report on Saturday.

Hedge Funds Weigh In On PRA Group

Several institutional investors and hedge funds have recently modified their holdings of the stock. Mariner LLC grew its holdings in shares of PRA Group by 4.8% during the 4th quarter. Mariner LLC now owns 11,175 shares of the business services provider's stock valued at $233,000 after acquiring an additional 515 shares in the last quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. raised its position in shares of PRA Group by 3.7% during the fourth quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 22,061 shares of the business services provider's stock valued at $461,000 after buying an additional 779 shares during the last quarter. State of Wyoming increased its stake in PRA Group by 9.0% in the fourth quarter. State of Wyoming now owns 10,255 shares of the business services provider's stock valued at $214,000 after acquiring an additional 850 shares during the period. Hsbc Holdings PLC increased its stake in PRA Group by 2.9% in the fourth quarter. Hsbc Holdings PLC now owns 37,900 shares of the business services provider's stock valued at $790,000 after acquiring an additional 1,060 shares during the period. Finally, Sterling Capital Management LLC grew its stake in PRA Group by 805.8% during the fourth quarter. Sterling Capital Management LLC now owns 1,241 shares of the business services provider's stock worth $26,000 after buying an additional 1,104 shares during the last quarter. 97.22% of the stock is currently owned by hedge funds and other institutional investors.

PRA Group Price Performance

The company's 50 day simple moving average is $15.26 and its two-hundred day simple moving average is $17.73. The stock has a market capitalization of $602.07 million, a P/E ratio of 6.61 and a beta of 1.54.

About PRA Group

PRA Group, Inc, a financial and business services company, engages in the purchase, collection, and management of portfolios of nonperforming loans worldwide. It is involved in the purchase of accounts that are primarily the unpaid obligations of individuals owed to credit originators, which include banks and other types of consumer, retail, and auto finance companies.