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ENCORE CAPITAL GROUP INC (ECPG) Stock Fundamental Analysis

NASDAQ:ECPG - Nasdaq - US2925541029 - Common Stock - Currency: USD

30.31  -0.1 (-0.33%)

Fundamental Rating

4

We assign a fundamental rating of 4 out of 10 to ECPG. ECPG was compared to 53 industry peers in the Consumer Finance industry. Both the profitability and financial health of ECPG have multiple concerns. ECPG may be a bit undervalued, certainly considering the very reasonable score on growth


Dividend Valuation Growth Profitability Health

3

1. Profitability

1.1 Basic Checks

ECPG had positive earnings in the past year.
ECPG had a positive operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: ECPG reported negative net income in multiple years.
Each year in the past 5 years ECPG had a positive operating cash flow.
ECPG Yearly Net Income VS EBIT VS OCF VS FCFECPG Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 200M -200M 400M

1.2 Ratios

With a Return On Assets value of -2.91%, ECPG is not doing good in the industry: 83.02% of the companies in the same industry are doing better.
ECPG has a Return On Equity of -18.15%. This is amonst the worse of the industry: ECPG underperforms 84.91% of its industry peers.
ECPG has a better Return On Invested Capital (5.01%) than 66.04% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ECPG is below the industry average of 8.61%.
Industry RankSector Rank
ROA -2.91%
ROE -18.15%
ROIC 5.01%
ROA(3y)-1.02%
ROA(5y)1.78%
ROE(3y)-7.9%
ROE(5y)4.66%
ROIC(3y)5.57%
ROIC(5y)6.77%
ECPG Yearly ROA, ROE, ROICECPG Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 10 -10 20 -20

1.3 Margins

The Operating Margin of ECPG (21.95%) is better than 71.70% of its industry peers.
In the last couple of years the Operating Margin of ECPG has declined.
ECPG has a Gross Margin of 77.98%. This is in the better half of the industry: ECPG outperforms 73.58% of its industry peers.
ECPG's Gross Margin has been stable in the last couple of years.
Industry RankSector Rank
OM 21.95%
PM (TTM) N/A
GM 77.98%
OM growth 3Y-11.86%
OM growth 5Y-8.47%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.31%
GM growth 5Y-0.74%
ECPG Yearly Profit, Operating, Gross MarginsECPG Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 20 40 60 80

2

2. Health

2.1 Basic Checks

ECPG has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for ECPG has been increased compared to 1 year ago.
Compared to 5 years ago, ECPG has less shares outstanding
ECPG has a worse debt/assets ratio than last year.
ECPG Yearly Shares OutstandingECPG Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 10M 20M 30M
ECPG Yearly Total Debt VS Total AssetsECPG Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 1B 2B 3B 4B

2.2 Solvency

ECPG has an Altman-Z score of 0.85. This is a bad value and indicates that ECPG is not financially healthy and even has some risk of bankruptcy.
ECPG has a Altman-Z score (0.85) which is in line with its industry peers.
ECPG has a debt to FCF ratio of 28.88. This is a negative value and a sign of low solvency as ECPG would need 28.88 years to pay back of all of its debts.
ECPG has a Debt to FCF ratio of 28.88. This is in the lower half of the industry: ECPG underperforms 64.15% of its industry peers.
ECPG has a Debt/Equity ratio of 4.79. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 4.79, ECPG is doing worse than 75.47% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 4.79
Debt/FCF 28.88
Altman-Z 0.85
ROIC/WACC0.75
WACC6.67%
ECPG Yearly LT Debt VS Equity VS FCFECPG Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 1B 2B 3B

2.3 Liquidity

A Current Ratio of 1.01 indicates that ECPG should not have too much problems paying its short term obligations.
ECPG's Current ratio of 1.01 is in line compared to the rest of the industry. ECPG outperforms 50.94% of its industry peers.
A Quick Ratio of 1.01 indicates that ECPG should not have too much problems paying its short term obligations.
The Quick ratio of ECPG (1.01) is comparable to the rest of the industry.
Industry RankSector Rank
Current Ratio 1.01
Quick Ratio 1.01
ECPG Yearly Current Assets VS Current LiabilitesECPG Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 100M 200M 300M

5

3. Growth

3.1 Past

ECPG shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 143.63%, which is quite impressive.
Measured over the past years, ECPG shows a decrease in Earnings Per Share. The EPS has been decreasing by -3.50% on average per year.
Looking at the last year, ECPG shows a small growth in Revenue. The Revenue has grown by 5.08% in the last year.
ECPG shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -1.19% yearly.
EPS 1Y (TTM)143.63%
EPS 3Y-24.44%
EPS 5Y-3.5%
EPS Q2Q%358.62%
Revenue 1Y (TTM)5.08%
Revenue growth 3Y-2.39%
Revenue growth 5Y-1.19%
Sales Q2Q%-4.24%

3.2 Future

ECPG is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 30.86% yearly.
Based on estimates for the next years, ECPG will show a quite strong growth in Revenue. The Revenue will grow by 10.19% on average per year.
EPS Next Y21.66%
EPS Next 2Y30.86%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year10.26%
Revenue Next 2Y10.19%
Revenue Next 3YN/A
Revenue Next 5YN/A

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
ECPG Yearly Revenue VS EstimatesECPG Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 500M 1B 1.5B
ECPG Yearly EPS VS EstimatesECPG Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2 4 6 8 10

8

4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 6.10, the valuation of ECPG can be described as very cheap.
Compared to the rest of the industry, the Price/Earnings ratio of ECPG indicates a somewhat cheap valuation: ECPG is cheaper than 77.36% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of ECPG to the average of the S&P500 Index (28.29), we can say ECPG is valued rather cheaply.
The Price/Forward Earnings ratio is 5.01, which indicates a rather cheap valuation of ECPG.
Compared to the rest of the industry, the Price/Forward Earnings ratio of ECPG indicates a rather cheap valuation: ECPG is cheaper than 86.79% of the companies listed in the same industry.
ECPG is valuated cheaply when we compare the Price/Forward Earnings ratio to 21.32, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 6.1
Fwd PE 5.01
ECPG Price Earnings VS Forward Price EarningsECPG Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, ECPG is valued a bit cheaper than the industry average as 69.81% of the companies are valued more expensively.
ECPG's Price/Free Cash Flow is on the same level as the industry average.
Industry RankSector Rank
P/FCF 5.65
EV/EBITDA 13.05
ECPG Per share dataECPG EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 10 20 30 40 50

4.3 Compensation for Growth

ECPG's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as ECPG's earnings are expected to grow with 30.86% in the coming years.
PEG (NY)0.28
PEG (5Y)N/A
EPS Next 2Y30.86%
EPS Next 3YN/A

0

5. Dividend

5.1 Amount

No dividends for ECPG!.
Industry RankSector Rank
Dividend Yield N/A

ENCORE CAPITAL GROUP INC

NASDAQ:ECPG (4/21/2025, 2:24:58 PM)

30.31

-0.1 (-0.33%)

Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryConsumer Finance
Earnings (Last)02-26 2025-02-26/amc
Earnings (Next)05-07 2025-05-07/amc
Inst Owners114.99%
Inst Owner Change0.09%
Ins Owners2.42%
Ins Owner Change7.51%
Market Cap718.04M
Analysts81.82
Price Target60.95 (101.09%)
Short Float %6.4%
Short Ratio5.1
Dividend
Industry RankSector Rank
Dividend Yield N/A
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-9.91%
Min EPS beat(2)-16.57%
Max EPS beat(2)-3.25%
EPS beat(4)0
Avg EPS beat(4)-9.41%
Min EPS beat(4)-16.57%
Max EPS beat(4)-1.25%
EPS beat(8)0
Avg EPS beat(8)-35.05%
EPS beat(12)2
Avg EPS beat(12)-33.35%
EPS beat(16)6
Avg EPS beat(16)-14.96%
Revenue beat(2)0
Avg Revenue beat(2)-15.33%
Min Revenue beat(2)-30.44%
Max Revenue beat(2)-0.23%
Revenue beat(4)0
Avg Revenue beat(4)-8.39%
Min Revenue beat(4)-30.44%
Max Revenue beat(4)-0.23%
Revenue beat(8)0
Avg Revenue beat(8)-10.33%
Revenue beat(12)0
Avg Revenue beat(12)-8.38%
Revenue beat(16)0
Avg Revenue beat(16)-7.92%
PT rev (1m)0%
PT rev (3m)-4.02%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-21.68%
EPS NY rev (1m)-20.5%
EPS NY rev (3m)-20.5%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-3.66%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-2.91%
Valuation
Industry RankSector Rank
PE 6.1
Fwd PE 5.01
P/S 0.55
P/FCF 5.65
P/OCF 4.6
P/B 0.94
P/tB 2.77
EV/EBITDA 13.05
EPS(TTM)4.97
EY16.4%
EPS(NY)6.05
Fwd EY19.95%
FCF(TTM)5.37
FCFY17.71%
OCF(TTM)6.59
OCFY21.75%
SpS55.57
BVpS32.39
TBVpS10.96
PEG (NY)0.28
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA -2.91%
ROE -18.15%
ROCE 6.34%
ROIC 5.01%
ROICexc 5.24%
ROICexgc 6.13%
OM 21.95%
PM (TTM) N/A
GM 77.98%
FCFM 9.66%
ROA(3y)-1.02%
ROA(5y)1.78%
ROE(3y)-7.9%
ROE(5y)4.66%
ROIC(3y)5.57%
ROIC(5y)6.77%
ROICexc(3y)5.79%
ROICexc(5y)7.05%
ROICexgc(3y)7.27%
ROICexgc(5y)9.12%
ROCE(3y)7.06%
ROCE(5y)8.57%
ROICexcg growth 3Y-19.09%
ROICexcg growth 5Y-10.87%
ROICexc growth 3Y-15.2%
ROICexc growth 5Y-9.09%
OM growth 3Y-11.86%
OM growth 5Y-8.47%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.31%
GM growth 5Y-0.74%
F-Score5
Asset Turnover0.27
Health
Industry RankSector Rank
Debt/Equity 4.79
Debt/FCF 28.88
Debt/EBITDA 11.43
Cap/Depr 89.43%
Cap/Sales 2.2%
Interest Coverage 1.37
Cash Conversion 48.6%
Profit Quality N/A
Current Ratio 1.01
Quick Ratio 1.01
Altman-Z 0.85
F-Score5
WACC6.67%
ROIC/WACC0.75
Cap/Depr(3y)74.18%
Cap/Depr(5y)74.01%
Cap/Sales(3y)2.36%
Cap/Sales(5y)2.35%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)143.63%
EPS 3Y-24.44%
EPS 5Y-3.5%
EPS Q2Q%358.62%
EPS Next Y21.66%
EPS Next 2Y30.86%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)5.08%
Revenue growth 3Y-2.39%
Revenue growth 5Y-1.19%
Sales Q2Q%-4.24%
Revenue Next Year10.26%
Revenue Next 2Y10.19%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y-4.83%
EBIT growth 3Y-13.97%
EBIT growth 5Y-9.56%
EBIT Next Year18.24%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-0.8%
FCF growth 3Y-22.17%
FCF growth 5Y-9.12%
OCF growth 1Y2.08%
OCF growth 3Y-19.83%
OCF growth 5Y-8.59%