World Acceptance Q1 revenue rises on loan volume growth

Overview

• U.S. personal lender's fiscal Q1 revenue rose 4.8% yr/yr

• Posts adjusted EPS for fiscal Q1 of $2.12

• Company repurchased 15,858 shares for about $2.2 mln during the quarter

Outlook

• Company expects to carefully increase new customer lending in coming quarters

Result Drivers

• EXISTING CUSTOMER BORROWING - Growth in loan volume was driven by increased borrowing from existing and refinance customers, while new customer loan volume fell sharply due to tightened underwriting

• CREDIT QUALITY IMPROVEMENT - Lower delinquency and net charge-off rates, along with a reduced provision for credit losses, contributed to results

• HIGHER OPERATING EXPENSES - General and administrative expenses increased, mainly due to CEO transition-related costs

Company press release: ID:nBw5nMsPHa

Key Details

Analyst Coverage

• The one available analyst rating on the shares is "hold"

• The average consensus recommendation for the consumer lending peer group is "buy."

• Wall Street's median 12-month price target for World Acceptance Corp is $141.00, about 22.1% below its July 23 closing price of $181.08

• The stock recently traded at 16 times the next 12-month earnings vs. a P/E of 10 three months ago

Reuters Recommended Reads

• July 23 - Enova International Inc Q2 revenue beats estimates on originations growth

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• July 23 - Switzerland's Cembra H1 net income rises on lower costs

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)