EZCORP, Inc - Aggressive Growth

EZCORP Inc. (EZPW) is not just a great growth story, shares have value and momentum characteristics as well.

This Zacks #1 Rank (Strong Buy) is coming off of a great earnings surprise and estimates are on the rise. The company and analysts are all looking for a very strong year.

Company Description

EZCORP operates more than 1,000 stores in North America, about half are pawn stores and the other half are short-term consumer loan stores. They also have investments in a couple international companies that offer similar services.

“Robust Results”

On Apr 21 the company reported what it called another quarter of “robust results” from each of its segments. As demand remains strong for their business, net revenues jumped 19%, to $131 million. Same store sales grew 12%.

Net income was up 34% on a year over year basis, to $31.8 million. That broke down to $0.63 per share, beating the Zacks Consensus Estimates by 6 cents. EZCORP has now topped forecasts in each of the past 3 quarters and has not missed since mid 2009.

Raised Guidance

The only thing better than an earnings surprise is when a company raises its guidance and EZPW did just that. EZCORP now is looking to earn $2.55 per share this year, up 15 cents from its previous guidance.

Analysts quickly raised their forecasts, which are now averaging the same as EZPW’s, showing a 30% growth rate. Next year’s estimates are up 13 cents, to and average of $2.94. That will give them a 15% growth rate in 2012.

Valuations are Good

You won’t need to take out a loan to pick up shares of EZPW. The stock trades at just 12 times forward estimates and with a PEG ratio of 0.7, both showing great value.

The Chart

Shares of EZPW took a plunge about 3 weeks ago when Texas lawmakers put a cap on short-term loans. But you can see that investors quickly got over that news and shares have plenty of momentum here.

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