Regional Management (RM) AI Stock Analysis

• Market Cap: $308.18M
• Dividend Yield: 4.04%
• Average Volume (3M): 46.38K
• Price to Earnings (P/E): 7.4
• Beta (1Y): 1.08
• Revenue Growth: 6.73%
• EPS Growth: 151.08%
• Country: US
• Employees: 2,131
• Sector: Financial
• Sector Strength: 83
• Industry: Financial - Credit Services
• EPS (TTM): 4.15
• Shares Outstanding: 10,035,287
• 10 Day Avg. Volume: 50,181
• 30 Day Avg. Volume: 46,380
• PEG Ratio: 0.05
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.59
• Price to Cash Flow (P/CF): 1.20
• P/FCF Ratio: 1.20
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $33.00
• Price Target Upside: 7.46% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 3

Regional Management's overall score reflects strong financial health and strategic growth plans, supported by positive earnings call sentiment and recent corporate events. However, technical analysis indicates current downward stock momentum, and while valuation metrics suggest the stock is undervalued, the market may still be cautious.

Positive Factors

Loan Growth

The company introduced its initial 2025 guidance, which points towards quicker loan growth for the year as credit continues to improve.

Portfolio Growth

Expect ending net receivables to grow by 10%-12% in 2025, up from ~6% growth.

Stock Repurchase Program

Board of Directors has authorized a stock repurchase program allowing for the repurchase of up to $30 million effective immediately.

Negative Factors

EPS Forecast

Increased provisioning brings the 2025 EPS forecast down, and similar estimate reductions by the Street have led to the shares trading down.

Market Concerns

RM shares are trading below historical multiples of 10x, reflecting market concerns of Regional's loss rates and moderate growth trends.

Revenue Yield

Revenue yield guidance is worse than consensus.

Regional Management Business Overview & Revenue Model

Company Description

Regional Management Corp., a diversified consumer finance company, provides various installment loan products primarily to customers with limited access to consumer credit from banks, thrifts, credit card companies, and other lenders in the United States. It offers small and large installment loans; and retail loans to finance the purchase of furniture, appliances, and other retail products. The company also provides insurance products, including credit life, credit accident and health, credit property, vehicle single interest, and credit involuntary unemployment insurance; collateral protection insurance; and property insurance, as well as reinsurance products. In addition, its loans are sourced through branches, centrally managed direct mail campaigns, digital partners, and retailers, as well as its consumer website. As of February 24, 2022, the company operated through a network of approximately 350 branches in 14 states. Regional Management Corp. was incorporated in 1987 and is headquartered in Greer, South Carolina.

How the Company Makes Money

Regional Management Corp. generates revenue primarily through the interest income and fees associated with the personal loans it extends to consumers. The company's revenue streams include interest income from personal loans, origination fees, late fees, and other ancillary charges. By underwriting and servicing these loans, Regional Management Corp. earns a steady stream of interest payments over the life of the loan. Additionally, the company may engage in strategic partnerships with retailers or other financial institutions to expand its loan offerings and enhance its market reach, further contributing to its revenue.

Regional Management Financial Statement Overview

Summary

Regional Management displays a strong financial position with impressive revenue growth and operational efficiency. The absence of debt in 2024 significantly enhances balance sheet stability, although the company could further optimize equity returns. Cash flow generation remains robust, indicating sound financial health. While profitability margins can improve, the overall trajectory is positive with low financial risk.

Income Statement

Regional Management has demonstrated strong revenue growth, with a notable increase in total revenue from $551 million in 2023 to $588 million in 2024. The gross profit margin is healthy, indicating efficient cost management with a margin of 95.61% in 2024. However, the net profit margin remains relatively modest at 6.91%, suggesting the potential for improved profitability. EBIT and EBITDA margins have improved significantly to 50.28% in 2024, showing strong operational efficiency.

Balance Sheet

The company exhibits a strong equity position with a stockholders' equity of $357 million in 2024, up from $322 million in 2023. The debt-to-equity ratio is favorable due to zero total debt, reflecting a low-risk profile. The equity ratio has improved to 18.71%, indicating a solid foundation. However, the return on equity (ROE) at 11.40% suggests there could be room for more efficient utilization of equity capital.

Cash Flow

Operating cash flow has increased to $269 million in 2024, supporting the company's operational strength. The free cash flow to net income ratio is robust, with free cash flow growing to $264 million. The operating cash flow to net income ratio is notably high at 6.61, indicating strong cash generation relative to net income. This reflects a solid cash management strategy, although consistent investment in capital expenditures should be monitored.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
588.50M	551.40M	472.96M	397.00M	336.05M
	Gross Profit
562.68M	331.37M	307.91M	385.35M	328.85M
	EBIT
295.98M	71.07M	99.54M	112.47M	35.93M
	EBITDA
142.68M	102.88M	112.23M	156.88M	0.00
	Net Income Common Stockholders
40.70M	15.96M	51.22M	88.69M	26.73M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
3.95M	4.51M	24.29M	10.51M	8.05M
	Total Assets
1.91B	1.79B	1.72B	1.46B	1.10B
	Total Debt
1.51B	1.43B	1.55B	1.13B	791.45M
	Net Debt
1.51B	1.43B	1.54B	1.12B	783.40M
	Total Liabilities
1.55B	1.47B	1.42B	1.18B	831.73M
	Stockholders Equity
357.08M	322.27M	308.63M	282.74M	272.12M
Cash Flow		Free Cash Flow
263.87M	237.10M	212.92M	182.15M	166.78M
	Operating Cash Flow
268.93M	249.17M	224.33M	189.01M	172.58M
	Investing Cash Flow
-315.37M	-278.72M	-447.29M	-355.06M	-98.81M
	Financing Cash Flow
53.41M	26.43M	205.57M	243.36M	-58.32M

Regional Management Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 30.71
• 50DMA: Negative
• 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 RM, the sentiment is Neutral. The current price of 30.71 is above the 20-day moving average (MA) of 30.25, below the 50-day MA of 32.13, and below the 200-day MA of 31.31, indicating a neutral trend. The MACD of -0.57 indicates Negative momentum. The RSI at 50.78 is Neutral, neither overbought nor oversold. The STOCH value of 70.40 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for RM.

Regional Management Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
YRD	84 Outperform	$504.03M	2.29	17.96%	3.38%	17.07%	-8.81%
MFIN	76 Outperform	$191.45M	5.41	10.06%	5.11%	14.58%	-34.99%
RM	73 Outperform	$308.18M	7.42	12.14%	4.04%	6.73%	151.08%
Sector *	63 Neutral	$13.51B	9.48	9.36%	4.87%	16.09%	-8.30%
CPSS	58 Neutral	$188.49M	11.13	6.77%	―	9.56%	-58.56%
OPRT	58 Neutral	$152.49M	―	-20.76%	―	-5.22%	60.29%
AHG	45 Neutral	$251.90M	―	-6.43%	―	-81.66%	-214.54%

Regional Management Corporate Events

Regional Management Completes $265 Million Securitization

On March 31, 2025, Regional Management Corp. completed a $265 million asset-backed securitization, marking its 12th successful securitization. This transaction involved the issuance of four classes of fixed-rate notes, secured by $298 million of receivables, and achieved a weighted-average coupon of 5.30%. The proceeds were used to pay down variable rate debt facilities and fully pay off notes from its previous 2020-1 securitization. The successful execution of this transaction enhances the company’s balance sheet and reduces exposure to interest rate risk, positioning Regional Management well for future growth and value creation for shareholders.

Regional Management Updates Executive Compensation Plan

On March 17, 2025, Regional Management Corp.’s Human Resources and Compensation Committee approved new compensation arrangements for its named executive officers under the 2024 Long-Term Incentive Plan. The plan includes performance restricted stock units, restricted stock, and restricted stock units, with vesting and earning conditions tied to company performance and continued employment through December 31, 2027, impacting the company’s executive retention and alignment with shareholder interests.

Regional Management Appoints Julie Booth to Board

On March 13, 2025, Regional Management Corp. announced the appointment of Julie Booth to its Board of Directors, expanding the board from eight to nine members. Booth, who brings extensive financial expertise from her previous roles, including as CFO of Rocket Companies, will also serve on the Audit Committee. Her appointment is expected to bolster Regional Management’s long-term growth strategy and provide valuable insights into consumer finance, enhancing the company’s industry positioning.

Regional Management Unveils Growth Strategy for 2025

Regional Management Corp. announced its growth strategy and financial performance in a presentation for bankers and investors starting February 24, 2025. The company emphasized its geographic and product expansion, leveraging digital capabilities and data analytics to enhance customer acquisition and retention. With a strong balance sheet, Regional Management continues to drive growth through new state expansions and product developments, aiming to capture a larger share of the $91 billion market opportunity. The company reported significant revenue growth in 2024, outpacing general and administrative expenses, and highlighted its high customer satisfaction and loyalty as key strengths.