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EZCORP, Inc. Message Board

  • ezpwjunky ezpwjunky Oct 25, 2006 4:26 PM Flag

    Q1 Estimates

    Well it looks like EZPW might get a nice pop when they announce earnings on Nov 9th. Here's why. Although they will fall within their latest guidance for the quarter (they'd look dumb if they didn't) and they will also probably not up FY'07 estimates...they have an ace up their sleeves.

    So what's the ace? Well, the analysts have them at 57 cents for Q1. This is outrageously low. Last year they hit 50 cents. Gold is also up more than $100/oz higher this Q1 vs last year's Q1. Therefore gold alone will drive them into the 60+ cent range.

    However, the real driver will be the maturation of the 300+ CSO and PDL stores. Also Q1 is seasonally one of their 2 best quarters as they sell tons of merchandise for X-mas. Add all this up (especially with gold as a tail wind at these prices) and once again Wall Street has screwed up their models.

    I expect Joe to guide to EPS in the 60-70 cent range (even sandbagging) and then to ultimately beat even these numbers with EPS in the 80s. So...a nice pop in November potentially and with these type of numbers we can expect to see the stock do it's normal pop during the January conference call.

    Run shorties....RUN!!!!!

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    • 1. Do you really expect Joe Rotunda to guide higher ($.70)for Q1 EPS? Currently, the estimates are around $.58.

      2. Do you really think EZPW will report $.80 (or more) for Q1?

      If so, I gotta think that $3.00 EPS for fiscal 2007 is a slam dunk...

      I have heard many "experts" talking about "expanding multiples" lately. Wall Street loves hyper-growth, and maybe EZPW will get a 30 multiple?
      30 x $3.00 = $90.00

      EZPW is a 2 bagger from here!

      • 1 Reply to qofaslave69
      • qo, Yes, IMO Rotunda will guide higher than 58 cents for Q1 on Nov 9th. I don't think he'll go all the way to 70 cents...but he might.

        Also whatever he guides to, you can bet he'll beat it (he has done this 95+% of the time for the last 6 years). Can he hit 80 cents? Maybe. But remember hitting 80 cents in Q1 does not make $3 of EPS automatic for FY'07 (Q1 and Q2 are better seasonal quarters than Q3 and Q4). However, 80 cents would make $3 look very attainable and it would make their current guidance of $2.40-$2.45 laughably low.

        Finally, I've been waiting for years for EZPW to get a P/E more consistent with their growth. So while a 30 P/E might make sense for some companies with this kind of growth, I think EZPW will probably be lucky to get a P/E in the mid 20s (until the dual class stock issue goes away). But, don't despair. With $3 of EPS and even a 23 P/E this is almost a $70 stock.

    • junky,

      $.80 in Q1 that would make $3.00 EPS in fiscal 2007 a slam dunk! I like the way you think!

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