Pra Group (PRAA) AI Stock Analysis

• Market Cap: $642.58M
• Dividend Yield: N/A
• Average Volume (3M): 333.74K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.01
• Revenue Growth: 13.89%
• EPS Growth: -899.50%
• Country: US
• Employees: 2,991
• Sector: Financial
• Sector Strength: 70
• Industry: Financial - Credit Services
• EPS (TTM): -10.43
• Shares Outstanding: 39,015,440
• 10 Day Avg. Volume: 235,662
• 30 Day Avg. Volume: 333,739
• PEG Ratio: -0.06
• Price to Book (P/B): 0.72
• Price to Sales (P/S): 0.73
• P/FCF Ratio: -8.34
• Enterprise Value/Market Cap: 6.73
• Enterprise Value/Revenue: 3.79
• Enterprise Value/Gross Profit: 6.22
• Enterprise Value/Ebitda: 17.59
• 1Y Price Target: $26.00
• Price Target Upside: 57.86% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): 2.1
• Revenue Forecast (FY): $1.24B

• Rating: 61 Neutral
• Price Target: $17.00 ▲(3.22% Upside)

Pra Group's overall stock score reflects a mixed financial performance with strong gross profit margins and improved leverage, but challenges in revenue growth and liquidity. Technical analysis indicates positive momentum, while valuation concerns persist due to a negative P/E ratio. The earnings call provided some positive insights, particularly in cash collections and operational efficiency, despite the impact of a goodwill impairment charge.

Positive Factors

Operational Efficiency

The cost-saving measures enhance operational efficiency and profitability, improving long-term financial stability and competitive positioning.

Cash Collections Growth

Strong cash collections growth indicates effective recovery strategies and enhances the company's ability to generate cash, supporting future investments and debt reduction.

European Market Performance

Improved performance in European markets suggests successful strategic execution and diversification, reducing reliance on U.S. markets and enhancing global competitiveness.

Negative Factors

Goodwill Impairment

The significant goodwill impairment charge reflects challenges in asset valuation, potentially impacting future earnings and investor confidence.

Revenue Decline

Declining revenue indicates challenges in market demand or competitive pressures, which could affect long-term growth prospects and profitability.

Liquidity Concerns

Negative cash flows highlight liquidity issues, limiting the company's ability to invest in growth opportunities and manage financial obligations effectively.

Pra Group Business Overview & Revenue Model

Company Description

PRA Group, Inc., a financial and business services company, engages in the purchase, collection, and management of portfolios of nonperforming loans in the Americas, Australia, and Europe. It is involved in the purchase of accounts that are primarily the unpaid obligations of individuals owed to credit originators, which include banks and other types of consumer, retail, and auto finance companies. The company also acquires nonperforming loans, including Visa and MasterCard credit cards, private label and other credit cards, installment loans, lines of credit, deficiency balances of various types, legal judgments, and trade payables from banks, credit unions, consumer finance companies, retailers, utilities, automobile finance companies, and other credit originators. In addition, it provides fee-based services on class action claims recoveries and by servicing consumer bankruptcy accounts. The company was formerly known as Portfolio Recovery Associates, Inc. and changed its name to PRA Group, Inc. in October 2014. PRA Group, Inc. was incorporated in 1996 and is headquartered in Norfolk, Virginia.

How the Company Makes Money

Pra Group generates revenue primarily through the purchase of non-performing loans at a discount, followed by the recovery of the outstanding balances from borrowers. The company's key revenue streams include the collections on acquired debt portfolios, which are often purchased at a fraction of their face value, and the fees charged for collection services rendered. Additionally, Pra Group may enter into partnerships with financial institutions to manage and collect on their delinquent accounts, further enhancing its income. The company's ability to leverage analytics to optimize collection strategies and improve recovery rates plays a critical role in its profitability, alongside its strategic focus on diversifying its portfolio of assets across various sectors and geographies.

Pra Group Financial Statement Overview

Summary

Pra Group shows strong gross profit margins and improved leverage, but faces challenges with declining revenue, modest profitability, and negative cash flows. The company needs to address revenue growth and liquidity to enhance its financial health.

Income Statement

Pra Group's income statement shows a mixed performance. The TTM gross profit margin is strong at 84.14%, indicating efficient cost management. However, the net profit margin is relatively low at 8.15%, and the revenue growth rate is negative, reflecting a decline in sales. The EBIT and EBITDA margins are moderate, suggesting stable operational efficiency despite revenue challenges.

Balance Sheet

The balance sheet reveals a significant improvement in the debt-to-equity ratio, dropping to 0.02 in the TTM period, which indicates reduced leverage and financial risk. However, the return on equity is modest at 7.47%, and the equity ratio is not provided, limiting a full assessment of financial stability.

Cash Flow

Cash flow analysis indicates challenges, with negative operating and free cash flows in the TTM period. The free cash flow to net income ratio is positive at 1.08, suggesting some ability to cover net income with free cash flow. However, the negative growth in free cash flow and operating cash flow coverage ratio highlight liquidity concerns.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.14B	1.12B	815.50M	966.52M	1.10B	1.07B
Gross Profit	694.94M	685.65M	416.04M	550.31M	669.61M	628.55M
EBITDA	245.97M	209.13M	10.49M	170.37M	266.11M	226.45M
Net Income	91.64M	70.60M	-83.48M	117.15M	183.16M	149.34M
Balance Sheet
Total Assets	5.43B	4.93B	4.53B	4.18B	4.37B	4.45B
Cash, Cash Equivalents and Short-Term Investments	196.37M	161.70M	172.00M	150.19M	87.58M	108.61M
Total Debt	3.64B	3.36B	4.40B	3.61B	3.84B	4.30B
Total Liabilities	4.04B	3.74B	3.29B	2.89B	3.04B	3.08B
Stockholders Equity	1.34B	1.14B	1.17B	1.23B	1.29B	1.34B
Cash Flow
Free Cash Flow	-61.99M	-98.64M	-100.42M	8.34M	73.71M	124.47M
Operating Cash Flow	-57.60M	-94.59M	-97.53M	21.59M	84.92M	141.70M
Investing Cash Flow	-319.68M	-382.47M	-234.86M	120.45M	160.38M	115.00M
Financing Cash Flow	392.91M	490.84M	355.30M	-121.34M	-262.81M	-252.10M

Pra Group Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 16.47
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PRAA, the sentiment is Neutral. The current price of 16.47 is below the 20-day moving average (MA) of 17.20, below the 50-day MA of 16.50, and above the 200-day MA of 15.97, indicating a neutral trend. The MACD of 0.04 indicates Positive momentum. The RSI at 43.19 is Neutral, neither overbought nor oversold. The STOCH value of 11.04 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for PRAA.

Pra Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
OMF	79 Outperform	$7.78B	11.22	21.41%	6.07%	9.51%	29.38%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
WU	67 Neutral	$2.99B	4.08	97.70%	10.18%	-2.51%	17.47%
ALLY	67 Neutral	$13.51B	26.42	4.25%	2.58%	-6.89%	-33.20%
LC	66 Neutral	$2.30B	22.50	7.40%	―	9.68%	94.85%
PRAA	61 Neutral	$642.58M	-1.87	-31.97%	―	13.89%	-899.50%
UPST	55 Neutral	$4.52B	203.91	4.81%	―	73.29%	―

Pra Group Corporate Events

PRA Group Reports Q3 2025 Results Amid Goodwill Impairment

PRA Group reported its third quarter 2025 results, highlighting a 13.7% increase in total cash collections to $542.2 million. Despite a net loss of $408 million due to a $413 million non-cash goodwill impairment charge, the company achieved an adjusted net income of $21 million. The impairment charge, linked to a European acquisition, did not impact operations or portfolio valuations. The company continues to focus on strategic priorities, including cost efficiency and IT modernization, while achieving a 27% increase in U.S. legal cash collections.

The most recent analyst rating on (PRAA) stock is a Hold with a $14.50 price target. To see the full list of analyst forecasts on Pra Group stock, see the PRAA Stock Forecast page.