Enova International (ENVA) AI Stock Analysis

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Enova International

(NYSE:ENVA)

77Outperform

Enova International shows strong financial performance with consistent revenue growth and effective cash flow management, which are the most significant factors contributing to its score. The company's robust operating performance and efficient cost management enhance its financial stability. The technical analysis indicates a neutral to slightly bearish short-term trend, and the valuation is reasonable with a moderate P/E ratio. The positive earnings call further supports the stock's potential, with impressive growth and positive future guidance. Caution is advised regarding potential macroeconomic and regulatory risks, but these are outweighed by the company's strengths.

Positive Factors

Earnings Performance

ENVA's 4Q24 results beat consensus with a 4% increase in adjusted EBITDA and a 16% increase in EPS.

Market Position

ENVA should continue to benefit from reduced competition as many smaller, less prudent subprime lenders have failed.

Revenue Growth

ENVA has historically managed to achieve fast receivable and revenue growth, way ahead of its expense growth.

Negative Factors

Growth Strategy

Enova closed out 2024 with continued displays of 'managed momentum,' as management concedes that it could grow originations even faster but wants to remain disciplined and present investors with a more consistent growth trajectory.

Risk Management

Management noted that it may have been 'under-risked' in its SMB book one year ago and feels more confident in employment and payment trends.

Enova International (ENVA) vs. S&P 500 (SPY)

Market Cap

$2.25B

Dividend YieldN/A

Average Volume (3M)257.11K

Price to Earnings (P/E)11.6

Beta (1Y)1.43

Revenue Growth25.51%

EPS Growth36.96%

CountryUS

Employees1,787

SectorFinancial

Sector Strength82

IndustryFinancial - Credit Services

Share Statistics

EPS (TTM)7.44

Shares Outstanding25,793,634

10 Day Avg. Volume249,912

30 Day Avg. Volume257,109

Financial Highlights & Ratios

PEG Ratio0.31

Price to Book (P/B)N/A

Price to Sales (P/S)1.07

Price to Cash Flow (P/CF)1.50

P/FCF Ratio1.30

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$130.83

Price Target Upside51.79% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering6

Enova International Business Overview & Revenue Model

Company DescriptionEnova International, Inc., a technology and analytics company, provides online financial services in the United States, Brazil, Australia, and Canada. The company offers installment loans; line of credit accounts; receivables purchase agreements; CSO programs, including arranging loans with independent third-party lenders and assisting in the preparation of loan applications and loan documents; and bank programs, such as marketing services and loan servicing for near-prime unsecured consumer installment loan. It markets its financing products under the CashNetUSA, NetCredit, OnDeck, Headway Capital, The Business Backer, Simplic, and Pangea names. Enova International, Inc. was incorporated in 2011 and is headquartered in Chicago, Illinois.

How the Company Makes MoneyEnova International generates revenue primarily through interest income and fees associated with its lending products. The company offers a diverse portfolio of credit products, including short-term loans, installment loans, and lines of credit, catering to both consumers and small businesses. Enova employs sophisticated risk management models to assess creditworthiness, allowing it to price loans effectively and manage risk. Additionally, the company has developed partnerships with third-party lenders and financial institutions to broaden its reach and enhance its product offerings. Key revenue streams include interest income from loans, origination fees, and service fees. By focusing on the online delivery of its financial products, Enova efficiently reaches a broad audience, optimizing both customer acquisition and retention.

Enova International Financial Statement Overview

Summary

Enova International demonstrates strong financial health, with consistent revenue growth, improved profitability, and effective cash flow management. The balance sheet shows reduced leverage, enhancing financial stability. Continued focus on optimizing margins and maintaining a balanced capital structure will be key to sustaining growth and mitigating risks.

Income Statement

Positive

Enova International has shown consistent revenue growth, with a notable increase of 25.47% from 2023 to 2024. The gross profit margin remains strong at 100%, indicating efficient cost management. The net profit margin improved from 8.27% in 2023 to 7.88% in 2024, suggesting enhanced profitability, although the slight decrease in net profit margin from the previous year indicates room for improvement. The company's EBIT margin of 21.99% and EBITDA margin of 0.79% in 2024 highlight strong operating performance but suggest potential non-cash charges affecting EBITDA.

Balance Sheet

Positive

The balance sheet shows a strong equity position with an increasing stockholders' equity. The debt-to-equity ratio has improved, reflecting reduced financial leverage due to zero total debt in 2024 compared to previous years. The return on equity stands at 17.50%, demonstrating efficient use of equity to generate profits. The equity ratio of 22.72% indicates a balanced capital structure but suggests potential risk if asset growth is not sustained.

Cash Flow

Very Positive

Enova International's cash flow is robust, with a significant 33.25% growth in free cash flow from 2023 to 2024. The operating cash flow to net income ratio is strong at 7.35, indicating healthy cash generation relative to net income. The free cash flow to net income ratio of 7.14 further emphasizes the company's solid cash flow position, supporting future investments and debt reduction.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
2.66B	2.12B	1.74B	1.21B	1.08B
	Gross Profit
1.24B	1.04B	1.12B	947.75M	597.50M
	EBIT
584.76M	422.13M	383.99M	413.06M	107.42M
	EBITDA
334.52M	265.51M	420.86M	448.44M	397.55M
	Net Income Common Stockholders
209.45M	175.12M	207.42M	256.30M	377.84M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
73.91M	54.36M	100.17M	165.48M	297.27M
	Total Assets
5.27B	4.59B	3.78B	2.76B	2.11B
	Total Debt
3.60B	2.97B	2.29B	1.43B	1.01B
	Net Debt
3.52B	2.92B	2.19B	1.26B	717.14M
	Total Liabilities
4.07B	3.35B	2.59B	1.67B	1.19B
	Stockholders Equity
1.20B	1.24B	1.19B	1.09B	917.35M
Cash Flow		Free Cash Flow
1.50B	1.12B	850.37M	442.19M	711.38M
	Operating Cash Flow
1.54B	1.17B	894.00M	471.87M	740.87M
	Investing Cash Flow
-1.91B	-1.49B	-1.67B	-980.37M	83.58M
	Financing Cash Flow
318.88M	526.54M	724.87M	365.15M	-535.97M

Enova International Technical Analysis

Technical Analysis Sentiment

Negative

Last Price86.19

Price Trends

50DMA

101.42

Negative

100DMA

101.83

Negative

200DMA

90.76

Negative

Market Momentum

MACD

-0.58

Negative

RSI

53.00

Neutral

STOCH

48.51

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ENVA, the sentiment is Negative. The current price of 86.19 is below the 20-day moving average (MA) of 94.92, below the 50-day MA of 101.42, and below the 200-day MA of 90.76, indicating a bearish trend. The MACD of -0.58 indicates Negative momentum. The RSI at 53.00 is Neutral, neither overbought nor oversold. The STOCH value of 48.51 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ENVA.

Enova International Risk Analysis

Enova International disclosed 56 risk factors in its most recent earnings report. Enova International reported the most risks in the “Legal & Regulatory” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Enova International Peers Comparison

Overall Rating

UnderperformOutperform

Sector (64)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ENVA	77 Outperform	$2.25B	11.58	17.19%	―	25.51%	36.96%
FINV	77 Outperform	$2.16B	6.62	16.47%	2.85%	2.51%	7.06%
Sector *	64 Neutral	$12.70B	9.08	9.19%	4.89%	16.29%	-8.64%
BFH	63 Neutral	$2.16B	7.99	9.31%	1.91%	-3.06%	-61.20%
PRK	60 Neutral	$2.31B	15.31	12.68%	2.97%	14.38%	19.61%
LC	53 Neutral	$1.00B	18.82	3.96%	―	3.63%	27.77%
LU	52 Neutral	$2.43B	―	-3.79%	5.03%	-38.81%	-425.73%

* Financial Sector Average

Performance Comparison

ENVA

Enova International

86.19

23.15

36.72%

BFH

Bread Financial Holdings

42.85

7.26

20.40%

PRK

Park National

142.99

13.47

10.40%

LendingClub

8.56

-0.25

-2.84%

FINV

FinVolution Group

8.10

3.01

59.14%

Lufax Holding

2.45

0.41

20.10%

Enova International Earnings Call Summary

Earnings Call Date: Feb 4, 2025 | % Change Since: -23.69% | Next Earnings Date: Apr 29, 2025

Earnings Call Sentiment Positive

The earnings call highlights strong financial performance with record-breaking results in 2024, driven by impressive growth in both small business and consumer lending segments, improved credit quality, and operational efficiency. However, there are cautious notes regarding potential macroeconomic risks and regulatory changes. Overall, the positive aspects significantly outweigh the concerns.

Highlights

Record Revenue and Growth

Enova achieved record levels of revenue, originations, and EPS in 2024, with revenue increasing by 25% year-over-year to $730 million in Q4.

Strong Small Business Lending

Small business lending revenue increased by 36% year-over-year to $286 million in Q4, with originations rising 20% to $1.1 billion.

Consumer Lending Growth

Consumer revenue increased 19% year-over-year to $434 million, with consumer originations up 21% to $602 million in Q4.

Improved Credit Quality

Net charge off ratio declined 80 basis points year-over-year to 8.9%. Both consumer and small business portfolios experienced meaningful decreases in net charge off ratios.

Operational Efficiency

Total operating expenses decreased to 34% of revenue from 37% in Q4 2023, showcasing efficient marketing and scalable operations.

Lowlights

Potential Macroeconomic Risks

While the company is well-positioned, there is a mindful approach to potential macroeconomic changes affecting the business.

Regulatory Challenges

Awaiting potential impacts from regulatory changes such as the small business disclosure rule (1071) and payment provisions of the small dollar rule.

Company Guidance

During the Enova International Fourth Quarter 2024 Earnings Call, the company reported significant financial achievements and offered guidance for 2025. Enova experienced over 20% growth in revenue, originations, adjusted EBITDA, and adjusted EPS compared to 2023, resulting in record levels of revenue, originations, and EPS for the year. Specifically, fourth quarter originations increased by 20% year-over-year to $1.7 billion, with the total loan and finance receivables reaching $4 billion, a 21% increase from the previous year. The portfolio comprised 62% small business loans and 38% consumer loans, with small business lending revenue up by 36% year-over-year to $286 million and consumer revenue up by 19% to $434 million. Marketing expenses remained consistent at 21% of total revenue. The company anticipates a 15% growth in originations and around 25% growth in adjusted EPS for 2025, along with a reduction in cost of funds by approximately 50 basis points from the 2024 rate, assuming stable macroeconomic conditions. Enova plans to maintain its strategy of balanced growth and risk management while continuing its stock repurchase program to enhance shareholder value.

Enova International Corporate Events

Private Placements and Financing

Enova International Announces $261M Asset-Backed Notes Offering

Neutral

Mar 13, 2025

On March 7, 2025, Enova International announced that its subsidiary, OnDeck Asset Securitization IV, LLC, plans to offer $261,392,000 in Series 2025-1 Fixed Rate Asset-Backed Notes through a private securitization transaction. The proceeds will be used to purchase small business loans from OnDeck, which will serve as collateral for the notes. The transaction, expected to close around March 20, 2025, aims to enhance OnDeck’s ability to support small businesses while not being guaranteed by Enova or OnDeck.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.