Financial and business services company PRA Group, Inc. PRAA is set to report its fourth-quarter 2024 results on Feb. 19, 2025, after the closing bell. The Zacks Consensus Estimate for the to-be-reported quarter’s earnings and revenues is pegged at 45 cents per share and $276.77 million, respectively.

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The earnings estimate for the to-be-reported quarter has remained stable over the past 60 days. The bottom-line projection indicates a year-over-year improvement of 304.6%. Also, the Zacks Consensus Estimate for quarterly revenues suggests a year-over-year increase of 25%.

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For 2024, the Zacks Consensus Estimate for PRA Group’s revenues is pegged at $1.10 billion, implying a rise of 36.8% year over year. Also, the consensus mark for current year EPS is pegged at $1.71, implying an improvement of 180.3% on a year-over-year basis.

PRA Group beat the consensus estimate for earnings in each of the trailing four quarters, with the average surprise being 305.3%, as you can see below.

PRAA’s Q4 Earnings Whispers

However, our proven model does not conclusively predict an earnings beat for PRA Group this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the chances of an earnings beat. That is not the case here, as you will see below.

PRAA has an Earnings ESP of 0.00% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

You can see the complete list of today’s Zacks #1 Rank stocks here.

Let’s see how things have shaped up before the fourth-quarter earnings announcement.

Q4 Factors to Note for PRA Group

PRA Group is expected to have witnessed improved cash collections, higher portfolio income and solid purchasing activity in the fourth quarter. Growing strength in its domestic and European businesses is expected to have benefited its collections. The Zacks Consensus Estimate for fourth-quarter total cash collections indicates 17.5% year-over-year growth.

Moreover, improved portfolio supply and pricing in the United States are likely to have aided its purchases. The Zacks Consensus Estimate for fourth-quarter portfolio income is pegged at $228.4 million, indicating a rise of 17.3% year over year.

Also, the consensus mark for changes in expected recoveries currently stands at $39 million, up 71.4% year over year. The company expects legal collection costs in the fourth quarter to be in the low $30 million range. The consensus mark for other revenues is pegged at $4.5 million, up 11.4% from a year ago.

The above-mentioned factors are likely to have positioned the company for year-over-year growth. However, total operating expenses are likely to have escalated in the quarter due to increased compensation and employee services, agency fees and other operating expenses, trimming its margins and making an earnings beat uncertain.

As the company continues to undertake several initiatives to drive improvement in customer contact rates and expand legal processes, expenses are expected to rise as a result.

How Did Other Stocks Perform?

Here are some other stocks in the broader Finance space that have already reported earnings for this quarter: Capital One COF, Golub Capital BDC, Inc. GBDC and Ares Capital Corporation ARCC.

Capital One’s fourth-quarter 2024 adjusted earnings of $3.09 per share surpassed the Zacks Consensus Estimate of $2.66 thanks to higher net interest income and non-interest income and rise in loans and deposits. Also, provisions declined during the quarter. However, the positives were partially offset by increased expenses.

Golub Capital reported first-quarter fiscal 2025 adjusted EPS of 39 cents, which missed the Zacks Consensus Estimate by 9.3% and declined sequentially from 47 cents. Over the past four quarters, the company beat consensus EPS estimates just once. Total investment income in first-quarter fiscal 2025 of $220.7 million missed the consensus mark by 2.5%. The figure also fell sequentially from $224.4 million.

Ares Capital’s fourth-quarter 2024 core earnings of 55 cents per share missed the Zacks Consensus Estimate of 58 cents due to an increase in expenses. However, an improvement in the total investment income and the company’s robust portfolio activities supported the results to some extent.

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Capital One Financial Corporation (COF) : Free Stock Analysis Report

PRA Group, Inc. (PRAA) : Free Stock Analysis Report

Ares Capital Corporation (ARCC) : Free Stock Analysis Report

Golub Capital BDC, Inc. (GBDC) : Free Stock Analysis Report

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