EZCORP (EZPW): Assessing Valuation After Recent Momentum Shift

EZCORP (EZPW) stock has moved around in recent sessions, prompting investors to consider what could be driving value for this diversified financial services provider. In the past month, the stock has dipped about 4%.

See our latest analysis for EZCORP.

After surging impressively earlier this year, EZCORP’s momentum has cooled a bit lately. The share price has slipped just over 3% in the past month, but it is still up a remarkable 49% year-to-date and has delivered a total shareholder return of 52% over the past year, with long-term holders seeing even greater gains. This shift suggests some profit taking and changing sentiment, but overall, the big-picture performance remains strong relative to the sector.

If you’re curious about what’s driving growth beyond EZCORP, this could be the perfect time to broaden your search and discover fast growing stocks with high insider ownership

With EZCORP shares still up nearly 50 percent in 2024 and trading at a notable discount to analyst targets, investors may wonder if there is still room for upside or if the market has already factored in future growth.

Most Popular Narrative: 23% Undervalued

According to the consensus narrative, EZCORP’s fair value is set well above the latest close. This suggests sizable upside based on future expectations. This sets up a compelling comparison between recent price action and what analysts believe is possible for the company’s shares.

Ongoing and accelerated store footprint expansion, particularly in large underserved markets across Latin America (for example, recent acquisitions in Mexico and new de novo stores in Guatemala and El Salvador), diversifies geographic risk and significantly increases addressable market size. This positions the company for outsized topline and EBITDA growth.

Read the complete narrative.

Want to see the math driving this bold upside? This narrative leans on ambitious projections for margins, topline growth, and profit multiples rarely seen outside high-growth disruptors. Is this the start of another breakout, or just the beginning? Dive in to uncover the full story.

Result: Fair Value of $23.50 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, dependence on gold prices and challenges in digital execution could undermine growth. This means potential headwinds remain for the bullish case.

Find out about the key risks to this EZCORP narrative.

Another View: The Earnings Multiple Challenge

While analyst narratives highlight strong upside, EZCORP’s price-to-earnings ratio stands at 11.2x, which is more expensive than both the Consumer Finance industry average of 10.1x and its direct peers at 9.3x. However, it remains below the fair ratio of 13.3x. This suggests possible upside, but also indicates valuation risk if the market adjusts. Is the growth story strong enough to justify paying a premium?

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own EZCORP Narrative

If the consensus doesn’t match your outlook, you can review the numbers yourself and form your own view in just a few minutes. Do it your way

A great starting point for your EZCORP research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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