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EZCORP, Inc. Message Board

  • the_greatest_investor the_greatest_investor Apr 11, 2012 11:34 AM Flag

    Logic? Where is the logic?

    I will be the first investor to agree that EZCORP is not the very best investment out there.

    But, as to whether it is worth placing a few cents in this investment, there can be no possible doubt. It's Price/Earnings Ratio of 11 is quite reasonable to any investor who takes a few seconds to look at its share price movement over the years. And the analysts clearly see that P/E of 11 dropping to under 9 based on earnings movement.

    You simply do not see a stock with its very long term upward earnings movement selling for a P/E of 11.

    Why? There must be a couple of "investors" in this stock who do not see the future because of the past.

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    • Their biggest negatives: Shareholders have non voting shares; there's also uncertainty due to the many acquisitions they've made over the last few years and no dividend or share repurchase program in place.

      On the plus side with its current price of 30, it's only 6 months away from being priced at 2 times book and 10 times earnings, yet its earnings are growing at 15% per year. Their balance sheet is also very conservative but I don't know if they own most of their stores or lease them? The other day I was talking to an owner of a chain of Auto parts stores and was informed that they were forced to close one of their locations they're leasing because the rents were outrageous and they'll buy property instead.

 
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11.20Jul 11 4:00 PMEDT

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