Atlanticus Holdings (ATLC) AI Stock Analysis

• Market Cap: $807.50M
• Dividend Yield: N/A
• Average Volume (3M): 61.64K
• Price to Earnings (P/E): 9.0
• Beta (1Y): 1.76
• Revenue Growth: 25.29%
• EPS Growth: 26.70%
• Country: US
• Employees: 417
• Sector: Financial
• Sector Strength: 70
• Industry: Financial - Credit Services
• EPS (TTM): 1.48
• Shares Outstanding: 15,141,530
• 10 Day Avg. Volume: 69,901
• 30 Day Avg. Volume: 61,640
• PEG Ratio: 0.68
• Price to Book (P/B): 1.67
• Price to Sales (P/S): 1.79
• P/FCF Ratio: 1.76
• Enterprise Value/Market Cap: 7.93
• Enterprise Value/Revenue: 10.85
• Enterprise Value/Gross Profit: 17.90
• Enterprise Value/Ebitda: 39.88
• 1Y Price Target: $98.33
• Price Target Upside: 94.25% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): 8.75
• Revenue Forecast (FY): $3.03B

• Rating: 73 Outperform
• Price Target: $65.00 ▲(28.41% Upside)

Atlanticus Holdings' overall stock score is driven by strong corporate events and reasonable valuation. The acquisition of Mercury Financial LLC is a significant positive factor, enhancing growth prospects. Financial performance is solid but hampered by high leverage and cash flow management challenges. Technical analysis indicates short-term bullish momentum, but potential overbought conditions should be monitored.

Positive Factors

Revenue Growth

Consistent revenue growth reflects the company's ability to expand its market presence and enhance product adoption, supporting long-term business sustainability.

Strategic Acquisition

The acquisition enhances product offerings and market reach, driving value creation through portfolio optimization and cost synergies, which strengthens the company's competitive position.

Profitability

A strong return on equity indicates efficient management and the company's ability to generate substantial profits from its equity base, supporting long-term financial health.

Negative Factors

High Leverage

High leverage can pose financial risks, limiting financial flexibility and potentially impacting the company's ability to invest in growth opportunities.

Cash Flow Constraints

Limited cash flow generation relative to net income may hinder the company's ability to fund operations and growth initiatives, affecting long-term sustainability.

Operational Efficiency

Declining EBIT margin indicates potential inefficiencies in operations, which could impact profitability and the company's ability to maintain competitive pricing and margins.

Atlanticus Holdings Business Overview & Revenue Model

Company Description

Atlanticus Holdings Corporation provides credit and related financial services and products to customers the United States. It operates in two segments, Credit as a Service, and Auto Finance. The Credit as a Service segment originates a range of consumer loan products, such as private label and general purpose credit cards originated by lenders through various channels, including retail and healthcare, direct mail solicitation, digital marketing, and partnerships with third parties; and offers credit to their customers for the purchase of various goods and services, including consumer electronics, furniture, elective medical procedures, healthcare, educational services, and home-improvements by partnering with retailers and service providers. In addition, it offers loan servicing, such as risk management and customer service outsourcing for third parties; and engages in testing and investment activities in consumer finance technology platforms. The Auto Finance segment purchases and/or services loans secured by automobiles from or for a pre-qualified network of independent automotive dealers and automotive finance companies in the buy-here, pay-here, and used car business. This segment also provides floor plan financing and installment lending products. Further, the company invests in and services portfolios of credit card receivables. Atlanticus Holdings Corporation was founded in 1996 and is headquartered in Atlanta, Georgia.

How the Company Makes Money

Atlanticus generates revenue through various channels, including interest income from loans and fees associated with its credit products. The company primarily earns money by extending credit to consumers who may have limited access to traditional financing, charging interest on outstanding balances. Additionally, Atlanticus collects fees related to account maintenance, late payments, and transaction processing. The company may also benefit from partnerships with retailers and service providers, offering co-branded credit products that can enhance customer acquisition and retention, thereby increasing its revenue streams.

Atlanticus Holdings Financial Statement Overview

Summary

Atlanticus Holdings demonstrates robust revenue growth and profitability, but faces challenges with high leverage and cash flow management. The company needs to focus on improving operational efficiency and reducing debt levels to enhance financial stability.

Income Statement

Atlanticus Holdings shows strong revenue growth with an 11.88% increase in TTM, supported by a solid gross profit margin of 114.53%. However, the net profit margin is relatively modest at 8.54%, indicating room for improvement in cost management. The EBIT margin has decreased compared to previous years, suggesting potential challenges in operational efficiency.

Balance Sheet

The company exhibits a high debt-to-equity ratio of 9.09, indicating significant leverage, which could pose financial risk. Return on equity is healthy at 20.20%, reflecting effective use of equity to generate profits. However, the equity ratio is low, suggesting a reliance on debt financing.

Cash Flow

Operating cash flow is strong, but the free cash flow growth rate has declined by 0.48% in TTM. The operating cash flow to net income ratio is low at 0.09, indicating potential cash flow constraints. However, the free cash flow to net income ratio is nearly 1, showing efficient conversion of profits into cash.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	590.14M	459.57M	365.68M	374.42M	453.93M	391.81M
Gross Profit	357.75M	283.03M	254.19M	291.31M	363.34M	197.55M
EBITDA	160.54M	143.76M	132.60M	154.12M	222.07M	122.34M
Net Income	118.37M	111.30M	102.84M	135.60M	177.90M	94.12M
Balance Sheet
Total Assets	7.08B	3.27B	2.71B	2.39B	1.94B	1.21B
Cash, Cash Equivalents and Short-Term Investments	425.02M	375.42M	339.34M	384.98M	409.66M	178.10M
Total Debt	6.06B	2.51B	2.03B	1.82B	1.43B	923.69M
Total Liabilities	6.49B	2.78B	2.31B	2.06B	1.66B	1.13B
Stockholders Equity	589.34M	492.91M	394.68M	326.41M	288.00M	77.28M
Cash Flow
Free Cash Flow	487.84M	467.62M	455.32M	341.28M	205.28M	211.99M
Operating Cash Flow	494.31M	469.40M	459.32M	346.13M	212.37M	212.73M
Investing Cash Flow	-1.20B	-747.03M	-672.20M	-680.78M	-475.02M	-292.57M
Financing Cash Flow	850.24M	393.61M	163.34M	261.25M	510.33M	162.38M

Atlanticus Holdings Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 50.62
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ATLC, the sentiment is Negative. The current price of 50.62 is below the 20-day moving average (MA) of 61.68, below the 50-day MA of 61.49, and below the 200-day MA of 57.77, indicating a bearish trend. The MACD of -2.65 indicates Positive momentum. The RSI at 26.64 is Positive, neither overbought nor oversold. The STOCH value of 4.12 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ATLC.

Atlanticus Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EZPW	75 Outperform	$1.30B	15.36	11.98%	―	9.70%	26.63%
ATLC	73 Outperform	$807.50M	8.99	21.01%	―	25.29%	26.70%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
WRLD	67 Neutral	$592.02M	14.80	14.57%	―	2.31%	-27.81%
OPRT	65 Neutral	$255.07M	8.20	8.59%	―	-5.29%	―
RM	64 Neutral	$358.69M	8.95	11.43%	2.99%	9.63%	77.14%
PRAA	51 Neutral	$616.83M	-1.47	-31.97%	―	13.89%	-899.50%