Education
About Us
Working with TipRanks
Follow Us
Regional Management (RM)
NYSE:RM
Top Page
Regional Management
(NYSE:RM)
Rating:72Outperform
Price Target:
$35.00
▲(6.25%Upside)
Positive Factors
Credit Trends
Management confirmed that peak credit stress was reached in 2023 and guidance implies steadily improving credit trends in the coming quarters.
Loan Growth
The company introduced its initial 2025 guidance, which points towards quicker loan growth for the year as credit continues to improve.
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.
Revenue Yield
Revenue yield guidance is worse than consensus.
Regional Management (RM) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$326.79M
Dividend Yield3.64%
Average Volume (3M)47.90K
Price to Earnings (P/E)10.0
Beta (1Y)0.92
Revenue Growth6.57%
EPS Growth44.84%
CountryUS
Employees2,131
SectorFinancial
Sector Strength82
IndustryFinancial - Credit Services
Share Statistics
EPS (TTM)0.70
Shares Outstanding9,920,620
10 Day Avg. Volume55,013
30 Day Avg. Volume47,897
Financial Highlights & Ratios
PEG Ratio-0.14
Price to Book (P/B)0.85
Price to Sales (P/S)0.00
P/FCF Ratio1.23
Enterprise Value/Market Cap3.57
Enterprise Value/Revenue0.53
Enterprise Value/Gross Profit2.21
Enterprise Value/Ebitda2.55
Forecast
1Y Price Target
$30.00Price Target Upside-8.93% Downside
Rating ConsensusHold
Number of Analyst Covering1
Regional Management Business Overview & Revenue Model
Company DescriptionRegional 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 MoneyRegional Management Corp. generates revenue through the interest and fees charged on its personal loans. The company primarily offers small to mid-sized installment loans, which are typically repaid over a fixed term. Revenue streams include interest income, which is the largest contributor, as well as non-interest income derived from ancillary products and services such as insurance products offered alongside loans. The company's earnings are significantly influenced by its ability to manage credit risk, customer acquisition and retention strategies, and operational efficiencies. Regional Management also benefits from partnerships with insurance providers to offer credit insurance and other financial products, enhancing its overall revenue potential.
Regional Management Earnings Call Summary
Earnings Call Date:Apr 30, 2025
(Q1-2025)
| % Change Since: 1.10%|
Next Earnings Date:Jul 30, 2025
Earnings Call Sentiment Positive
The earnings call presented a strong start to the year with record originations and successful branch expansion, alongside positive credit performance. However, the quarter faced challenges with increased expenses and economic uncertainties. Despite these challenges, the company remains optimistic about achieving its growth and income targets for 2025.Q1-2025 Updates
Positive Updates
Strong Start to 2025
The company posted a net income of $7 million and $0.70 of diluted EPS for the first quarter, in line with guidance. Record first quarter originations were achieved while maintaining a tightened credit box, and ending net receivables were up 8% year-over-year, the fastest growth rate since 2023.
Successful Branch Expansion
15 new branches were opened in September 2024, with 10 in new markets. These branches are performing well, generating $1.5 million in revenue against $1.1 million of G&A expense. This expansion demonstrates the power of the branch-based model in driving growth.
Barbell Strategy Success
The auto-secured loan portfolio grew by 37% year-over-year, while the small loan portfolio with APRs above 36% grew by 21%. These portfolios performed well and supported the customer graduation strategy.
Record Revenue Achieved
The loan portfolio generated $153 million of revenue in the quarter, up 7% from the prior year period. Total capital generation since 2020 was $339 million, averaging an annual capital generation of 21% as a percentage of stockholder's equity.
Positive Credit Performance
The 30-plus-day delinquency rate was 7.1%, flat year-over-year, and net credit losses were $1.6 million better than guidance. The front book now makes up 92% of the portfolio and is performing well.
Negative Updates
Lower Income Compared to Prior Year
Net income for the first quarter of 2025 was lower than the first quarter of 2024 due to the benefit in the prior year of a special loan sale.
Increased Expenses
G&A expenses were $66 million in the first quarter, $5.6 million higher than the prior year period, due to incentive expenses and investment in growth, including new branch openings and marketing expenses.
Economic Uncertainty
Concerns about the macroeconomic environment, particularly related to tariffs and potential economic downturns, were highlighted as factors that could impact future performance.
Higher Interest Expenses Expected
Interest expenses are anticipated to increase as lower fixed-rate funding matures and growth continues using variable-rate debt.
Company Guidance
During the first quarter of 2025, Regional Management Corp. reported $7 million in net income and $0.70 in diluted EPS, aligning with their guidance. The company experienced a relatively low seasonal liquidation of $2 million, a significant improvement compared to the $27 million decline in the same quarter of the previous year. This was attributed to growth initiatives, including the opening of 15 new branches. Their loan portfolio, including auto-secured and higher-margin small loans, generated a record $153 million in revenue, up 7% from the prior year. The auto-secured loan portfolio grew by 37% year-over-year to 12% of the total portfolio. Despite macroeconomic uncertainties, the company maintained a 10.5% allowance for credit loss reserve rate and reported an annualized net credit loss rate of 12.4%, which was 120 basis points better than the prior year after adjustments. They also highlighted their capital generation strategy, which resulted in $9.9 million of capital in the first quarter, with an overall significant capital generation since 2020. Looking forward, Regional Management Corp. aims for a minimum of 10% portfolio growth in 2025, leveraging their branch-based model and a tightened credit box, while navigating potential economic challenges.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 the 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.75
Positive
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.70
Positive
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.80
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 558.00M | 588.50M | 551.40M | 472.96M | 397.00M | 336.05M |
| Gross Profit | 528.77M | 562.68M | 331.37M | 307.91M | 385.35M | 328.85M |
| EBITDA | 140.19M | 142.68M | 102.88M | 112.23M | 156.88M | 0.00 |
| Net Income | 37.08M | 40.70M | 15.96M | 51.22M | 88.69M | 26.73M |
Balance Sheet | ||||||
| Total Assets | 1.90B | 1.91B | 1.79B | 1.72B | 1.46B | 1.10B |
| Cash, Cash Equivalents and Short-Term Investments | 4.16M | 3.95M | 4.51M | 24.29M | 10.51M | 8.05M |
| Total Debt | 0.00 | 1.51B | 1.43B | 1.55B | 1.13B | 791.45M |
| Total Liabilities | 1.54B | 1.55B | 1.47B | 1.42B | 1.18B | 831.73M |
| Stockholders Equity | 357.88M | 357.08M | 322.27M | 308.63M | 282.74M | 272.12M |
Cash Flow | ||||||
| Free Cash Flow | 268.79M | 263.87M | 237.10M | 212.92M | 182.15M | 166.78M |
| Operating Cash Flow | 274.12M | 268.93M | 249.17M | 224.33M | 189.01M | 172.58M |
| Investing Cash Flow | -355.31M | -315.37M | -278.72M | -447.29M | -355.06M | -98.81M |
| Financing Cash Flow | 85.25M | 53.41M | 26.43M | 205.57M | 243.36M | -58.32M |
Regional Management Technical Analysis
Positive
32.94
Price Trends
28.78
Positive
30.06
Positive
30.85
Positive
Market Momentum
0.84
Negative
75.65
Negative
96.22
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RM, the sentiment is Positive. The current price of 32.94 is above the 20-day moving average (MA) of 28.85, above the 50-day MA of 28.78, and above the 200-day MA of 30.85, indicating a bullish trend. The MACD of 0.84 indicates Negative momentum. The RSI at 75.65 is Negative, neither overbought nor oversold. The STOCH value of 96.22 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RM.
Regional Management Risk Analysis
Regional Management disclosed 54 risk factors in its most recent earnings report. Regional Management reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Regional Management Peers Comparison
Overall Rating
UnderperformOutperform
Sector (67)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $227.49M | 6.12 | 10.39% | 4.90% | 13.93% | -23.70% | |
75 Outperform | $215.81M | 12.57 | 6.69% | ― | 13.23% | -47.36% | |
73 Outperform | $522.76M | 2.84 | 14.69% | 3.64% | 12.45% | -36.64% | |
72 Outperform | $326.79M | 10.00 | 9.51% | 3.64% | 6.57% | 44.84% | |
67 Neutral | $17.01B | 11.90 | 9.70% | 3.76% | 11.63% | -9.47% | |
61 Neutral | $310.60M | ― | -11.37% | ― | -5.79% | 59.24% | |
45 Neutral | $295.08M | ― | -6.43% | ― | -81.66% | -214.54% |
* Financial Sector Average
Performance Comparison
RM
Regional Management
32.94
6.58
24.96%
CPSS
Consumer Portfolio Services
10.01
0.53
5.59%
MFIN
Medallion Financial
9.79
2.11
27.47%
YRD
Yiren Digital
6.05
1.96
47.92%
AHG
Akso Health Group Sponsored ADR
1.23
0.21
20.59%
OPRT
Oportun Financial
7.08
4.55
179.84%
Regional Management Corporate Events
Private Placements and FinancingShareholder Meetings
Regional Management Amends Credit Agreement in May 2025
Neutral
May 21, 2025
On May 19, 2025, Regional Management Corp. and its subsidiary amended their Credit Agreement to remove certain requirements, redefine terms, and extend the termination date, impacting their financial operations and stakeholder interests. Additionally, at the 2025 Annual Meeting on May 15, stockholders elected directors, ratified an auditor, and approved executive compensation, reflecting shareholder engagement and governance practices.
The most recent analyst rating on (RM) stock is a Buy with a $40.00 price target. To see the full list of analyst forecasts on Regional Management stock, see the RM Stock Forecast page.
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.