Dj Officer Hambleton Sells 4000 Of Firstcash Holdings Inc >Fcfs

What Happened?

Shares of pawn store operator FirstCash Holdings jumped 3% in the afternoon session after the Federal Reserve announced a 0.25% cut to its benchmark interest rate, which boosted broader market sentiment. 

The Federal Open Market Committee (FOMC) confirmed its third consecutive rate reduction, which brought the federal funds rate down to a range of 3.50%-3.75%. This decision marked the lowest policy rate in nearly three years. The central bank's move reflected an effort to balance a cooling job market with inflation that remained above the Fed's long-term 2% goal. While the Fed reduced its key rate, it also signaled that it might leave rates unchanged in the coming months.

After the initial pop the shares cooled down to $163.06, up 2.7% from previous close.

Is now the time to buy FirstCash? Access our full analysis report here.

What Is The Market Telling Us

FirstCash’s shares are not very volatile and have only had 5 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.

The previous big move we wrote about was 20 days ago when the stock gained 2.6% on the news that investors grew more optimistic about a potential Federal Reserve interest rate cut in December. 

The positive sentiment was fueled by comments from New York Fed President John Williams, a voting member of the rate-setting Federal Open Market Committee, who stated the central bank could cut rates "in the near term" without jeopardizing its inflation targets. Following his remarks, market expectations for a rate cut in December shifted significantly. According to the CME FedWatch Tool, the probability of a December rate reduction surged from a 37% chance earlier in the day to 70%. While lower rates can compress bank profit margins, investors often view them as a catalyst for broader economic activity, potentially boosting loan demand and reducing the risk of defaults.

FirstCash is up 58.9% since the beginning of the year, and at $163.06 per share, has set a new 52-week high. Investors who bought $1,000 worth of FirstCash’s shares 5 years ago would now be looking at an investment worth $2,295.

Let’s dig into the relative performance of FirstCash and its peers as we unravel the now-completed Q3 personal loan earnings season.

Personal loan providers offer unsecured credit for various consumer needs. The sector benefits from digital application processes, increasing consumer comfort with online financial services, and opportunities in underserved credit segments. Headwinds include credit risk management in unsecured lending, regulatory oversight of lending practices, and intense competition affecting margins from both traditional and fintech lenders.

The 9 personal loan stocks we track reported a very strong Q3. As a group, revenues beat analysts’ consensus estimates by 5.8%.

Thankfully, share prices of the companies have been resilient as they are up 5.1% on average since the latest earnings results.

FirstCash

Offering a financial lifeline to the unbanked and credit-constrained since 1988, FirstCash operates pawn stores across the U.S. and Latin America while also providing retail point-of-sale payment solutions for credit-constrained consumers.

FirstCash reported revenues of $935.6 million, up 11.7% year on year. This print exceeded analysts’ expectations by 9.3%. Overall, it was a stunning quarter for the company with a solid beat of analysts’ revenue estimates and an impressive beat of analysts’ EBITDA estimates.

Mr. Rick Wessel, chief executive officer, stated, “FirstCash’s third quarter operating results were outstanding, evidenced by accelerating revenue growth, strong margins and continued earnings growth in both the U.S. and Latin American pawn segments coupled with a strong partial quarter contribution from the recently acquired H&T pawn stores in the U.K. We continue to experience extremely strong pawn demand across all markets, with third quarter local currency same-store pawn receivables up 13% in the U.S., 18% in Latin America and 25% in the U.K. over last year. Additionally, the retail point-of-sale payment solutions segment, American First Finance or “AFF,” recorded strong earnings growth driven by lower loss provisions and improved operating margins.

Interestingly, the stock is up 7.5% since reporting and currently trades at $159.13.

Is now the time to buy FirstCash? Access our full analysis of the earnings results here, it’s free for active Edge members.

Best Q3: Dave

Named after the biblical David fighting financial Goliaths, Dave is a digital financial services platform that helps Americans living paycheck to paycheck with cash advances, banking services, and tools to improve their financial health.

Dave reported revenues of $150.7 million, up 63% year on year, outperforming analysts’ expectations by 12.9%. The business had an incredible quarter with a beat of analysts’ EPS estimates and a solid beat of analysts’ revenue estimates.

Dave pulled off the biggest analyst estimates beat and highest full-year guidance raise among its peers. Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 18.5% since reporting. It currently trades at $195.61.

Is now the time to buy Dave? Access our full analysis of the earnings results here, it’s free for active Edge members.

Enova

Pioneering online lending since 2004 with a massive database of over 65 terabytes of customer behavior data, Enova International provides online financial services including installment loans and lines of credit to non-prime consumers and small businesses in the United States and Brazil.

Enova reported revenues of $802.7 million, up 16.3% year on year, in line with analysts’ expectations. Still, its results were good as it locked in an impressive beat of analysts’ EBITDA estimates and a beat of analysts’ EPS estimates.

Enova delivered the weakest performance against analyst estimates in the group. Interestingly, the stock is up 18.3% since the results and currently trades at $134.91.

Read our full analysis of Enova’s results here.

OneMain

Dating back to 1912 and formerly known as Springleaf, OneMain Holdings provides personal loans, auto financing, and credit cards to nonprime consumers who have limited access to traditional banking services.

OneMain reported revenues of $1.27 billion, up 9.8% year on year. This result surpassed analysts’ expectations by 2.8%. Overall, it was an exceptional quarter as it also put up a beat of analysts’ EPS estimates and an impressive beat of analysts’ net interest income estimates.

OneMain had the slowest revenue growth among its peers. The stock is up 17.2% since reporting and currently trades at $65.33.

Read our full, actionable report on OneMain here, it’s free for active Edge members.

Sezzle

Founded in 2016 as an alternative to traditional credit cards for younger shoppers, Sezzle provides a payment platform that allows consumers to split purchases into four interest-free installments over six weeks at participating retailers.

Sezzle reported revenues of $116.8 million, up 67% year on year. This number beat analysts’ expectations by 10.1%. It was an exceptional quarter as it also logged an impressive beat of analysts’ revenue estimates and a solid beat of analysts’ EBITDA estimates.

Sezzle delivered the fastest revenue growth among its peers. The stock is up 5.4% since reporting and currently trades at $69.85.

Read our full, actionable report on Sezzle here, it’s free for active Edge members.

The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s take a look at how personal loan stocks fared in Q3, starting with LendingClub .

Personal loan providers offer unsecured credit for various consumer needs. The sector benefits from digital application processes, increasing consumer comfort with online financial services, and opportunities in underserved credit segments. Headwinds include credit risk management in unsecured lending, regulatory oversight of lending practices, and intense competition affecting margins from both traditional and fintech lenders.

The 9 personal loan stocks we track reported a very strong Q3. As a group, revenues beat analysts’ consensus estimates by 5.8%.

Thankfully, share prices of the companies have been resilient as they are up 5.9% on average since the latest earnings results.

LendingClub

Pioneering peer-to-peer lending in the US before evolving into a digital bank, LendingClub operates a marketplace that connects borrowers with lenders, offering personal loans, auto refinancing, and banking services.

LendingClub reported revenues of $266.2 million, up 31.9% year on year. This print exceeded analysts’ expectations by 3.9%. Overall, it was an exceptional quarter for the company with a beat of analysts’ EPS estimates and an impressive beat of analysts’ revenue estimates.

Interestingly, the stock is up 16.3% since reporting and currently trades at $19.21.

We think LendingClub is a good business, but is it a buy today? Read our full report here, it’s free for active Edge members.

Best Q3: Dave

Named after the biblical David fighting financial Goliaths, Dave is a digital financial services platform that helps Americans living paycheck to paycheck with cash advances, banking services, and tools to improve their financial health.

Dave reported revenues of $150.7 million, up 63% year on year, outperforming analysts’ expectations by 12.9%. The business had an incredible quarter with a beat of analysts’ EPS estimates and an impressive beat of analysts’ revenue estimates.

Dave achieved the biggest analyst estimates beat and highest full-year guidance raise among its peers. Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 16.2% since reporting. It currently trades at $201.23.

Is now the time to buy Dave? Access our full analysis of the earnings results here, it’s free for active Edge members.

Slowest Q3: Enova

Pioneering online lending since 2004 with a massive database of over 65 terabytes of customer behavior data, Enova International provides online financial services including installment loans and lines of credit to non-prime consumers and small businesses in the United States and Brazil.

Enova reported revenues of $802.7 million, up 16.3% year on year, in line with analysts’ expectations. Still, its results were good as it locked in a solid beat of analysts’ EBITDA estimates and a beat of analysts’ EPS estimates.

Enova delivered the weakest performance against analyst estimates in the group. Interestingly, the stock is up 19.2% since the results and currently trades at $135.89.

Read our full analysis of Enova’s results here.

FirstCash

Offering a financial lifeline to the unbanked and credit-constrained since 1988, FirstCash operates pawn stores across the U.S. and Latin America while also providing retail point-of-sale payment solutions for credit-constrained consumers.

FirstCash reported revenues of $935.6 million, up 11.7% year on year. This number surpassed analysts’ expectations by 9.3%. Overall, it was a stunning quarter as it also logged an impressive beat of analysts’ revenue estimates and a solid beat of analysts’ EBITDA estimates.

The stock is up 7.5% since reporting and currently trades at $159.12.

Read our full, actionable report on FirstCash here, it’s free for active Edge members.

Affirm

Founded by PayPal co-founder Max Levchin with a mission to create honest financial products, Affirm provides a payment network that allows consumers to make purchases and pay for them over time with transparent, flexible installment loans.

Affirm reported revenues of $933.3 million, up 33.6% year on year. This print topped analysts’ expectations by 5.5%. It was a strong quarter as it also recorded a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ revenue estimates.

The stock is up 3.5% since reporting and currently trades at $68.10.

Read our full, actionable report on Affirm here, it’s free for active Edge members.