Encore Capital Group (NASDAQ:ECPG) Reaches New 12-Month High on Earnings Beat

Key Points

• Encore Capital beat quarterly expectations: EPS was $5.57 versus the $3.35 consensus, while revenue of $544.54 million topped estimates of $466.80 million and rose 18.3% year over year.
• The shares reached a new 52-week high after the earnings announcement; the article reports a 19.9% stock gain.
• Analyst sentiment was broadly positive, with five Buy ratings and one Hold; Citizens JMP raised its price target to $140, and the average target was $109.50.

Encore Capital Group Inc (NASDAQ:ECPG - Get Free Report) shares hit a new 52-week high on Thursday after the company announced better than expected quarterly earnings. The company traded as high as $106.83 and last traded at $112.8610, with a volume of 1,166 shares traded. The stock had previously closed at $99.93.

The asset manager reported $5.57 earnings per share for the quarter, beating analysts' consensus estimates of $3.35 by $2.22. Encore Capital Group had a return on equity of 29.83% and a net margin of 15.86%. The company had revenue of $544.54 million for the quarter, compared to the consensus estimate of $466.80 million. During the same quarter in the prior year, the company earned $3.17 earnings per share. Encore Capital Group's revenue was up 18.3% on a year-over-year basis.

Analysts Set New Price Targets

ECPG has been the subject of a number of research analyst reports. Zacks Research cut shares of Encore Capital Group from a "strong-buy" rating to a "hold" rating in a report on Monday, October 5th. Weiss Ratings upgraded Encore Capital Group from a "buy (b-)" rating to a "buy (b)" rating in a report on Thursday, October 8th. Truist Financial raised their target price on Encore Capital Group from $105.00 to $112.00 and gave the company a "buy" rating in a report on Thursday, August 6th. Citizens Jmp raised their target price on shares of Encore Capital Group from $115.00 to $140.00 and gave the company a "market outperform" rating in a report on Thursday. Finally, Northland Securities set a $124.00 target price on shares of Encore Capital Group in a report on Tuesday, October 13th. Five investment analysts have rated the stock with a Buy rating and one has issued a Hold rating to the stock. According to MarketBeat, Encore Capital Group currently has an average rating of "Moderate Buy" and an average price target of $109.50.

Institutional Inflows and Outflows

Several hedge funds have recently added to or reduced their stakes in ECPG. Ashton Thomas Private Wealth LLC grew its stake in Encore Capital Group by 4.1% during the 3rd quarter. Ashton Thomas Private Wealth LLC now owns 2,825 shares of the asset manager's stock valued at $267,000 after acquiring an additional 110 shares in the last quarter. Signaturefd LLC grew its stake in shares of Encore Capital Group by 185.9% in the 3rd quarter. Signaturefd LLC now owns 366 shares of the asset manager's stock valued at $35,000 after purchasing an additional 238 shares during the period. Kendall Capital Management bought a new position in Encore Capital Group during the 3rd quarter valued at about $508,000. Carnegie Investment Counsel lifted its stake in shares of Encore Capital Group by 2.3% during the third quarter. Carnegie Investment Counsel now owns 28,030 shares of the asset manager's stock valued at $2,647,000 after acquiring an additional 636 shares during the period. Finally, Nisa Investment Advisors LLC boosted its position in shares of Encore Capital Group by 26.1% in the 3rd quarter. Nisa Investment Advisors LLC now owns 1,711 shares of the asset manager's stock worth $162,000 after purchasing an additional 354 shares during the last quarter.

Encore Capital Group Stock Up 19.9%

The stock has a market cap of $2.54 billion, a price-to-earnings ratio of 8.98 and a beta of 1.29. The firm has a 50 day simple moving average of $99.09 and a two-hundred day simple moving average of $83.57. The company has a debt-to-equity ratio of 3.87, a current ratio of 0.96 and a quick ratio of 0.96.

Encore Capital Group Company Profile

Encore Capital Group, Inc is a specialty finance company that purchases portfolios of charged-off consumer receivables and provides debt recovery and management services. Through its operating businesses, the company works with consumers to resolve outstanding obligations through payment plans and other repayment arrangements.

Encore serves consumers and creditors across multiple markets, including the United States, the United Kingdom and other European countries. Its major operating platforms include Midland Credit Management in the United States and Cabot Credit Management in Europe.

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