Regional Management Corp. RM recently launched a $30 million stock buyback program authorized by its board of directors. The company aims to opportunistically repurchase shares when it believes the stock is undervalued, leveraging its financial position and liquidity.

The buyback program is effective immediately and will run through Dec. 31, 2026. It reflects the company’s confidence in its financial health and aims to enhance shareholder value. Earlier, Regional Management announced a dividend of 30 cents per share for the fourth quarter of 2024.

The success of its shareholder value boosting efforts will depend on sustained credit performance, economic conditions and the effective execution of its growth plans.

RM’s Growth Plans

The company targets net receivables to increase 10-12% in 2025, a significant increase compared to the roughly 6% growth rate achieved in 2024. Continued emphasis on auto-secured and higher-margin small loan portfolios is expected to drive portfolio growth. It expects growth to pick up after the first quarter, following the seasonal slowdown in loan demand during the tax season.

It also plans to aggressively expand its presence by opening 10 new branches between fourth-quarter 2024 and first-quarter 2025, with up to 10 more branches in the latter half of 2025. These new branches will help capture market share in new regions, resulting in revenue growth. Since 2020, RM has expanded into eight new states, boosting its addressable market size by more than 80%.

Earlier, it stated that Ending Net Finance Receivables will likely grow in the range of $65-$70 million in the fourth quarter of 2024. It targets about 60-70 basis points sequential growth in total revenue yield for the fourth quarter of 2024.

RM Stock Price Performance

Shares of Regional Management have gained 32.8% in the past year compared with the 64.3% growth of the financial consumer loans industry.

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Zacks Rank & Key Picks

Regional Management currently has a Zacks Rank #3 (Hold).

Investors interested in the broader Finance space may look at some better-ranked players like Jackson Financial Inc. JXN, WisdomTree, Inc. WT and Houlihan Lokey, Inc. HLI. While Jackson Financial currently sports a Zacks Rank #1 (Strong Buy), WisdomTree and Houlihan Lokey carry a Zacks Rank #2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Jackson Financial’s current-year earnings is pegged at $18.80 per share, which indicates 46.4% year-over-year growth. It witnessed two upward estimate revisions in the past 60 days against no downward movement. The consensus mark for JXN’s current year revenues suggests a 120.4% surge from a year ago.

The Zacks Consensus Estimate for WisdomTree’s 2024 earnings indicates 75.7% year-over-year growth. During the past 60 days, WT has witnessed three upward estimate revisions against none in the opposite direction. It beat earnings estimates thrice in the past four quarters and met once, with an average surprise of 7.3%.

The Zacks Consensus Estimate for Houlihan Lokey’s current-year earnings suggests a 29.6% year-over-year increase. During the past month, HLI has witnessed one upward estimate revision against none in the opposite direction. The consensus mark for current-year revenues is pegged at $2.3 million, indicating a 19.6% increase from a year ago.

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