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PRA Group (PRAA) Q2 Earnings Surpass Estimates, Soar Y/Y

PRA Group, Inc.’s PRAA second-quarter 2020 earnings per share of $1.26 beat the Zacks Consensus Estimate by 82.6%. Moreover, the bottom line skyrocketed 207.3% year over year, primarily owing to improved top-line growth.

Revenues of $272 million were also up 7.9% from the year-ago quarter, courtesy of portfolio income. Further, the top line surpassed the Zacks Consensus Estimate by 3.4%.

The company’s cash collection of $509.9 million climbed 8% from the year-ago figure on the back of higher contributions from Americas Core. Cash collections in the quarter were solid in the United States.

PRA Group, Inc. Price, Consensus and EPS Surprise

PRA Group, Inc. Price, Consensus and EPS Surprise
PRA Group, Inc. Price, Consensus and EPS Surprise

PRA Group, Inc. price-consensus-eps-surprise-chart | PRA Group, Inc. Quote

Quarterly Operational Update

PRA Group’s fee income of $2.6 million dipped 2.5% year over year.

The company’s portfolio income came in at $248.3 million in the quarter under review, against income recognized on finance receivables of $249.2 million in the prior-year quarter.

Total operating expenses decreased 14.3% over year to $160.6 million, mainly owing lower legal collection fees amid the closure of courts in many European countries because of the COVID-19 pandemic. Moreover, lower compensation and employee benefits as a result of trimmed U.S. call center staff also contributed to this upside.

Business Update

The company spent $164.5 million on finance receivables in the quarter under review.

Financial Update

As of Jun 30, 2020, it had total assets worth $4.2 billion, down 5.1% from the level at 2019 end.

PRA Group exited the quarter with total equity of $1.1 billion, down 2.6% from the level on Dec 31, 2019.

Cash and cash equivalents in the quarter under discussion were $115.7 million, down 3.4% from the level at 2019 end.

At the end of the second quarter, borrowings decreased 8.1% to $2.6 billion from the number at 2019 end.

Zacks Rank and Performance of Other Players

PRA Group currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Of the other companies in the same space that already reported second-quarter earnings, the bottom-line results of American Express Company AXP, Visa Inc. V and Synchrony Financial SYF beat the respective Zacks Consensus Estimate.

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PRA Group, Inc. (PRAA) : Free Stock Analysis Report
 
American Express Company (AXP) : Free Stock Analysis Report
 
Visa Inc. (V) : Free Stock Analysis Report
 
Synchrony Financial (SYF) : Free Stock Analysis Report
 
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