World Acceptance (NASDAQ:WRLD) Announces Quarterly Earnings Results, Misses Expectations By $0.04 EPS

Key Points

• Missed EPS: World Acceptance reported Q4 EPS of $7.70, missing the $7.74 consensus by $0.04 and including an after-tax charge of roughly $0.25 related to a senior executive retirement.
• Business trends: Total revenue rose 7.4% with loans outstanding up 4.4% and improved delinquencies, which management expects will drive higher revenue and lower charge-offs while relying less on new customers to improve credit quality.
• Capital allocation: The company repurchased $37.8 million of stock in the quarter, bringing total repurchases to the equivalent of about 16.5% of outstanding shares at the start of the fiscal year.

World Acceptance (NASDAQ:WRLD - Get Free Report) released its quarterly earnings data on Thursday. The credit services provider reported $7.70 EPS for the quarter, missing the consensus estimate of $7.74 by ($0.04), Zacks reports. World Acceptance had a return on equity of 10.80% and a net margin of 7.46%.

Here are the key takeaways from World Acceptance's conference call:

• EPS of $7.70 in Q4 (includes an after-tax charge of ~$0.25 related to a senior executive retirement), signaling strong reported profitability for the quarter.
• Total revenue rose 7.4% driven by higher loans outstanding and yields, with interest, fee and insurance income up 5.4% and tax-preparation returns prepared up 13% this season.
• Loans outstanding increased 4.4% while delinquency improved in both rate and dollars; management expects this to produce higher revenue and lower charge-offs and plans to rely less on new customers to boost credit quality.
• Field headcount was reduced ~5% after a prior build-up, with personnel expense guidance of $47M–$49M for the first three quarters (slightly higher in Q4), indicating cost control but mixed quarterly cadence.
• The company repurchased an additional $37.8 million of shares in the quarter, bringing total repurchases to the equivalent of 16.5% of outstanding shares at the start of the fiscal year.

World Acceptance Stock Performance

Shares of WRLD stock traded down $6.09 during mid-day trading on Thursday, reaching $147.16. 292,326 shares of the company's stock traded hands, compared to its average volume of 145,262. World Acceptance has a 12 month low of $110.00 and a 12 month high of $185.48. The firm has a 50 day moving average price of $139.86 and a two-hundred day moving average price of $141.25. The company has a debt-to-equity ratio of 1.64, a quick ratio of 25.01 and a current ratio of 25.01. The firm has a market capitalization of $726.97 million, a PE ratio of 18.84 and a beta of 1.17.

Analyst Upgrades and Downgrades

Separately, Weiss Ratings restated a "hold (c)" rating on shares of World Acceptance in a research note on Friday, March 27th. Two research analysts have rated the stock with a Hold rating, According to MarketBeat.com, the stock presently has an average rating of "Hold".

Insider Buying and Selling at World Acceptance

In other news, insider John L. Calmes, Jr. sold 1,000 shares of World Acceptance stock in a transaction dated Tuesday, March 10th. The stock was sold at an average price of $141.88, for a total transaction of $141,880.00. Following the transaction, the insider directly owned 50,334 shares of the company's stock, valued at $7,141,387.92. The trade was a 1.95% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available at this hyperlink. 41.60% of the stock is currently owned by insiders.

Institutional Inflows and Outflows

A number of large investors have recently made changes to their positions in the stock. Invesco Ltd. lifted its position in shares of World Acceptance by 11.6% during the 4th quarter. Invesco Ltd. now owns 33,047 shares of the credit services provider's stock valued at $4,639,000 after buying an additional 3,445 shares in the last quarter. Empowered Funds LLC lifted its position in shares of World Acceptance by 7.8% during the 4th quarter. Empowered Funds LLC now owns 27,022 shares of the credit services provider's stock valued at $3,794,000 after buying an additional 1,952 shares in the last quarter. Smith Thomas W purchased a new position in shares of World Acceptance during the 4th quarter valued at about $10,894,000. Susquehanna Fundamental Investments LLC purchased a new position in shares of World Acceptance during the 4th quarter valued at about $961,000. Finally, Millennium Management LLC lifted its position in shares of World Acceptance by 680.5% during the 4th quarter. Millennium Management LLC now owns 67,649 shares of the credit services provider's stock valued at $9,497,000 after buying an additional 58,982 shares in the last quarter. 83.63% of the stock is owned by hedge funds and other institutional investors.

About World Acceptance

World Acceptance Corporation NASDAQ: WRLD is a consumer finance company headquartered in Greenville, South Carolina. Founded in 1972, the company provides credit solutions to underserved customers who may have limited access to traditional banking services. Over the decades, World Acceptance has built a reputation for tailored lending that emphasizes responsible underwriting and personalized customer service.

The company's core product offerings include short-term installment loans designed to meet the immediate financial needs of its clients.

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