Pra Group (PRAA) AI Stock Analysis

• Market Cap: $632.16M
• Dividend Yield: N/A
• Average Volume (3M): 405.69K
• Price to Earnings (P/E): 8.9
• Beta (1Y): 1.45
• Revenue Growth: 23.90%
• EPS Growth: N/A
• Country: US
• Employees: 2,991
• Sector: Financial
• Sector Strength: 73
• Industry: Financial - Credit Services
• EPS (TTM): 0.09
• Shares Outstanding: 39,658,700
• 10 Day Avg. Volume: 295,909
• 30 Day Avg. Volume: 405,694
• PEG Ratio: N/A
• Price to Book (P/B): 0.51
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -6.27
• Enterprise Value/Market Cap: 0.81
• Enterprise Value/Revenue: 0.13
• Enterprise Value/Gross Profit: 0.64
• Enterprise Value/Ebitda: 0.55
• 1Y Price Target: $28.00
• Price Target Upside: 77.78% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

• Rating: 66 Neutral
• Price Target: $17.00 ▲(7.94%Upside)

Pra Group's overall stock score is driven by strong technical analysis and valuation, indicating potential for growth despite financial performance challenges related to profitability and leverage. The earnings call underscored operational strengths with some profitability concerns. Improvement in financial stability and cash flow management could enhance the overall outlook.

Positive Factors

Company Stability

The new CEO, Martin Sjolund, has extensive experience with the company, especially in European operations, suggesting continuity and stability.

Financial Performance

PRA Group delivered another quarter of EPS and purchasing volume upside and refined the 2025 guidance metrics that raised purchasing and earnings outlook.

Leadership and Strategy

The CEO transition follows a successful operational turnaround, indicating strong leadership and strategic direction.

Negative Factors

Macro and Market Conditions

PRA entered 2025 with 17% higher Estimated Remaining Collections than a year ago, with a stable employment and macro backdrop in the U.S. and most European markets driving better-than-forecast performance.

Operational Changes

Management indicates no significant changes are expected in execution and initiatives, implying consistency in strategy.

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 acquisition and collection of nonperforming loan portfolios. The company purchases delinquent debt at a discount from face value and then employs a range of collection strategies to recover the outstanding amounts, thereby realizing a profit. Its revenue model is heavily reliant on its ability to accurately assess the value of debt portfolios and efficiently collect on them. Key revenue streams include collections on consumer debt, fees for contingent collections, and, to a lesser extent, interest income from finance receivables. The company’s earnings are significantly influenced by its operational efficiency, the quality of acquired debt portfolios, and economic factors affecting consumers' ability to repay debts.

Pra Group Financial Statement Overview

Summary

Pra Group exhibits strong revenue growth and gross profit margins, but profitability is hindered by high expenses and leverage. The balance sheet shows significant debt levels, raising concerns about financial stability. Cash flow challenges further point to liquidity constraints. Overall, while there are growth opportunities, the company must address profitability and cash management to enhance financial health.

Income Statement

The company shows a strong gross profit margin of 70.7% for TTM, indicating efficient cost management. However, the net profit margin is relatively low at 6.3%, suggesting potential challenges in controlling operating and other expenses. The revenue growth rate for TTM is significant at 37.9%, reflecting robust top-line expansion. Nevertheless, the net income has been volatile, with a shift from a loss in 2023 to a profit in the TTM period.

Balance Sheet

The debt-to-equity ratio is high at 2.96 for TTM, indicating substantial leverage, which could pose financial risk. The return on equity is modest at 6.2%, reflecting challenges in generating profits from equity investment. The equity ratio stands at 23.0%, suggesting a moderate reliance on equity financing compared to total assets.

Cash Flow

The company faces challenges with negative free cash flow for TTM, indicating potential liquidity issues. The operating cash flow to net income ratio is negative, highlighting difficulties in converting profits into cash. The free cash flow to net income ratio is also negative, suggesting that cash outflows exceed inflows from operations.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.12B	815.50M	968.75M	1.10B	1.07B
Gross Profit	685.65M	504.66M	612.11M	718.08M	628.55M
EBITDA	209.13M	133.54M	301.05M	390.25M	368.17M
Net Income	70.60M	-83.48M	117.15M	183.16M	149.34M
Balance Sheet
Total Assets	4.93B	4.53B	4.18B	4.37B	4.45B
Cash, Cash Equivalents and Short-Term Investments	161.70M	172.00M	83.38M	87.58M	108.61M
Total Debt	3.36B	3.08B	2.55B	2.67B	2.72B
Total Liabilities	3.74B	3.29B	2.89B	3.04B	3.08B
Stockholders Equity	1.14B	1.17B	1.23B	1.29B	1.34B
Cash Flow
Free Cash Flow	-98.64M	-100.42M	8.34M	73.71M	124.47M
Operating Cash Flow	-94.59M	-97.53M	21.59M	84.92M	141.70M
Investing Cash Flow	-382.47M	-234.86M	120.45M	160.38M	115.00M
Financing Cash Flow	488.44M	355.30M	-121.34M	-262.81M	-252.10M

Pra Group Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 15.75
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PRAA, the sentiment is Positive. The current price of 15.75 is above the 20-day moving average (MA) of 15.62, above the 50-day MA of 15.00, and below the 200-day MA of 19.15, indicating a neutral trend. The MACD of 0.22 indicates Negative momentum. The RSI at 54.92 is Neutral, neither overbought nor oversold. The STOCH value of 65.85 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PRAA.

Pra Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EZPW	78 Outperform	$742.69M	11.81	10.84%	―	8.14%	14.79%
RM	72 Outperform	$318.35M	10.14	9.51%	3.74%	6.57%	44.84%
CPSS	69 Neutral	$196.63M	11.43	6.69%	―	13.23%	-47.36%
PRAA	66 Neutral	$632.16M	8.91	6.03%	―	23.90%	―
ATLC	65 Neutral	$774.77M	9.92	22.68%	―	15.21%	20.25%
WRLD	63 Neutral	$843.28M	9.47	19.08%	―	0.77%	―
Sector *	62 Neutral	AU$10.03B	9.04	11.83%	4.87%	33.36%	41.81%

Pra Group Corporate Events

PRA Group Appoints Martin Sjolund as CEO and Director

On June 17, 2025, PRA Group, Inc. appointed Martin Sjolund as President and CEO, amending his Service Agreement to reflect his new role and increasing his compensation package. Concurrently, R. Owen James was promoted to President of PRA Group Europe, with an amended employment contract reflecting his new position and compensation. Additionally, the company’s Board of Directors appointed Sjolund as a director for a one-year term, and the 2025 Annual Meeting saw the election of directors and the ratification of Ernst & Young LLP as the independent auditor.

The most recent analyst rating on (PRAA) stock is a Buy with a $23.00 price target. To see the full list of analyst forecasts on Pra Group stock, see the PRAA Stock Forecast page.

PRA Group Reports Strong Q1 2025 Financial Results

On May 5, 2025, PRA Group reported its first quarter 2025 results, showcasing a 19% growth in portfolio purchases and a record estimated remaining collections of $7.8 billion. The company experienced double-digit cash collections growth and a 5.3% increase in net income year-over-year, positioning itself for continued success with the transition to a newly appointed CEO.