Pepper Money Ltd (AU:PPM)
ASX:PPM
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Pepper Money Ltd
(Sydney:PPM)
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Rating:57Neutral
Price Target:
AU$1.50
▼(-31.51% Downside)
Action:Reiterated
Date:03/18/26
The score is primarily constrained by financial risk—extreme leverage and volatile cash flow (including negative 2025 cash generation). Valuation is a key positive with a low P/E and very high dividend yield, but weak technical positioning below major moving averages limits near-term confidence.
Positive Factors
Niche specialist lending model
Pepper Money’s focus on non‑prime and specialist mortgage markets creates a durable niche with structurally higher spreads and fee opportunities versus prime banks. That business model supports recurring net interest income and fee generation from underwriting and servicing over multiple credit cycles.
Negative Factors
Extremely high leverage
Debt levels this large leave very limited equity buffer and amplify losses from credit deterioration. High leverage constrains balance sheet flexibility, increases refinancing and covenant risk, and makes the firm sensitive to funding cost rises or stressed credit cycles over the next several months.
Read all positive and negative factors
Positive Factors
Negative Factors
Niche specialist lending model
Pepper Money’s focus on non‑prime and specialist mortgage markets creates a durable niche with structurally higher spreads and fee opportunities versus prime banks. That business model supports recurring net interest income and fee generation from underwriting and servicing over multiple credit cycles.
Read all positive factors
Pepper Money Ltd (PPM) vs. iShares MSCI Australia ETF (EWA)
Market Cap
AU$736.78M
Dividend Yield11.71%
Average Volume (3M)326.68K
Price to Earnings (P/E)7.1
Beta (1Y)1.27
Revenue Growth-8.26%
EPS Growth5.26%
CountryAU
Employees863
SectorFinancial
Sector Strength70
IndustryFinancial - Credit Services
Share Statistics
EPS (TTM)0.24
Shares Outstanding449,255,070
10 Day Avg. Volume338,103
30 Day Avg. Volume326,679
Financial Highlights & Ratios
PEG Ratio1.01
Price to Book (P/B)1.10
Price to Sales (P/S)0.66
P/FCF Ratio-1.33
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
AU$2.00Price Target Upside-8.68% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering1
EPS Forecast (FY)0.24
Revenue Forecast (FY)AU$439.06M
Pepper Money Ltd Business Overview & Revenue Model
Company Description
Pepper Money Limited, an Australian non-bank financial institution established in 2000 and headquartered in North Sydney, serves clients in both Australia and New Zealand. It primarily operates as a lender within the mortgage and asset finance sec...
How the Company Makes Money
PPM primarily makes money through net interest income and lending-related fees generated from its loan portfolio. Net interest income is earned from the spread between (a) interest charged to borrowers on mortgages and other credit products and (b...
Pepper Money Ltd Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
46
Neutral
Cash Flow
38
Negative
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.45B | 1.58B | 1.52B | 1.06B | 771.30M |
| Gross Profit | 1.39B | 1.53B | 417.70M | 987.60M | 699.60M |
| EBITDA | 1.13B | 1.29B | 170.60M | 801.90M | 545.10M |
| Net Income | 104.60M | 98.80M | 110.70M | 141.00M | 120.80M |
Balance Sheet | |||||
| Total Assets | 18.40B | 17.47B | 20.21B | 19.92B | 17.27B |
| Cash, Cash Equivalents and Short-Term Investments | 1.27B | 1.24B | 1.53B | 1.24B | 1.31B |
| Total Debt | 17.42B | 16.47B | 19.26B | 18.98B | 16.52B |
| Total Liabilities | 17.53B | 16.62B | 19.34B | 18.99B | 16.63B |
| Stockholders Equity | 869.90M | 855.60M | 825.40M | 801.90M | 636.40M |
Cash Flow | |||||
| Free Cash Flow | -720.50M | 2.59B | 91.20M | -2.31B | -3.00B |
| Operating Cash Flow | -714.80M | 2.60B | 98.30M | -2.30B | -2.99B |
| Investing Cash Flow | -5.70M | -49.30M | -7.50M | -87.60M | -266.40M |
| Financing Cash Flow | 761.30M | -2.85B | 194.30M | 2.32B | 3.68B |
Pepper Money Ltd Technical Analysis
Neutral
2.19
Price Trends
1.71
Negative
1.86
Negative
1.99
Negative
Market Momentum
-0.02
Negative
50.62
Neutral
29.33
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:PPM, the sentiment is Neutral. The current price of 2.19 is above the 20-day moving average (MA) of 1.66, above the 50-day MA of 1.71, and above the 200-day MA of 1.99, indicating a neutral trend. The MACD of -0.02 indicates Negative momentum. The RSI at 50.62 is Neutral, neither overbought nor oversold. The STOCH value of 29.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for AU:PPM.
Pepper Money Ltd Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
59 Neutral | AU$834.50M | 9.35 | 10.55% | 4.81% | 3.49% | -12.05% | |
57 Neutral | AU$736.78M | 7.11 | 12.70% | 11.71% | -8.26% | 5.26% | |
56 Neutral | AU$135.01M | 9.05 | 20.23% | ― | 20.39% | -42.91% | |
52 Neutral | AU$946.16M | 10.18 | 7.72% | 6.60% | 8.89% | 334.62% | |
50 Neutral | AU$950.27M | 6.65 | 12.13% | 11.83% | -4.02% | 17.32% | |
43 Neutral | AU$66.64M | -1.34 | -43.76% | ― | 17.04% | -121.43% |
* Financial Sector Average
AU:PPM
Pepper Money Ltd
1.69
0.05
2.74%
AU:CCP
Credit Corp Group Limited
12.69
0.19
1.50%
AU:PLT
Plenti Group Ltd.
0.72
-0.14
-16.28%
AU:LFS
Latitude Group Holdings Ltd.
0.92
-0.12
-11.20%
AU:MME
MoneyMe Ltd.
0.08
-0.06
-40.71%
AU:LFG
Liberty Financial Group Ltd
3.17
0.50
18.55%
Pepper Money Ltd Corporate Events
Pepper Money Seeks ASX Quotation for Additional Ordinary Shares
Jun 10, 2026
Pepper Money Ltd has applied for quotation on the ASX of 36,857 new ordinary fully paid shares, to be traded under its existing ticker PPM. The new securities, issued on 10 June 2026, slightly increase the company’s listed share capital and ...
Pepper Money Investors Back Directors and Executive Pay at 2026 AGM
Apr 20, 2026
Pepper Money’s 2026 annual general meeting saw all resolutions passed, including the adoption of the remuneration report and the re-election of directors Akiko Jackson and Rob Verlander. Shareholders also approved the issue of rights and res...
Pepper Money releases chair and CEO addresses for AGM
Apr 20, 2026
Pepper Money has released the prepared addresses of chair Akiko Jackson and chief executive Mario Rehayem ahead of its Annual General Meeting being held today. The publication of these speeches underscores the non‑bank lender’s ongoing...
Pepper Money Brings Forward Dividend Payment Date for Shareholders
Mar 26, 2026
Pepper Money has updated its previously announced dividend timetable for the six-month period ended 31 December 2025 on its ordinary fully paid shares. The company has brought the dividend payment date forward by two days to give shareholders earl...
Challenger’s Pepper Money Bid Rebuffed as $150m Buy-Back Cleared
Mar 24, 2026
Challenger Limited’s confidential, non-binding and conditional proposal, made jointly with Pepper Group ANZ HoldCo Limited to acquire Pepper Money Limited, has been rejected by Pepper Money’s Independent Board Committee as not reasonab...
Pepper Money Ends Challenger Bid Talks as Growth and Capital Returns Build
Mar 24, 2026
Pepper Money has ended talks with Challenger Limited after its Independent Board Committee concluded that Challenger’s revised non-binding takeover proposal of A$2.25 per share was not reasonably capable of being executed. The decision halts...
Challenger Trims Bid but Labels Offer for Pepper Money ‘Best and Final’
Mar 16, 2026
Challenger Limited has submitted a revised confidential, non-binding and conditional joint proposal with Pepper Group ANZ HoldCo Limited to acquire Pepper Money Limited. The new offer cuts the bid from $2.60 to $2.25 per Pepper Money share, adjust...
Challenger Cuts Takeover Offer for Pepper Money Amid Weakening Market Conditions
Mar 16, 2026
Pepper Money has disclosed that Challenger Limited has revised its non-binding indicative proposal to acquire 100% of Pepper Money’s shares via a scheme of arrangement, cutting the offer price from A$2.60 to A$2.25 per share. The new price i...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.