First Cash (FCFS) & Its Competitors Critical Review

First Cash (NYSE: FCFS) is one of 25 publicly-traded companies in the “Consumer Lending” industry, but how does it weigh in compared to its peers? We will compare First Cash to related businesses based on the strength of its analyst recommendations, dividends, earnings, institutional ownership, risk, valuation and profitability.

Institutional & Insider Ownership

95.7% of First Cash shares are held by institutional investors. Comparatively, 78.7% of shares of all “Consumer Lending” companies are held by institutional investors. 2.8% of First Cash shares are held by insiders. Comparatively, 14.1% of shares of all “Consumer Lending” companies are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares First Cash and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
First Cash 6.41% 8.45% 5.91%
First Cash Competitors -135.88% -89.02% -1.29%

Earnings and Valuation

This table compares First Cash and its peers revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
First Cash $1.09 billion $60.12 million 29.06
First Cash Competitors $2.77 billion $388.84 million 21.27

First Cash’s peers have higher revenue and earnings than First Cash. First Cash is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Risk & Volatility

First Cash has a beta of 0.79, suggesting that its stock price is 21% less volatile than the S&P 500. Comparatively, First Cash’s peers have a beta of 1.45, suggesting that their average stock price is 45% more volatile than the S&P 500.

Dividends

First Cash pays an annual dividend of $0.80 per share and has a dividend yield of 1.2%. First Cash pays out 34.2% of its earnings in the form of a dividend. As a group, “Consumer Lending” companies pay a dividend yield of 1.7% and pay out 29.6% of their earnings in the form of a dividend. First Cash lags its peers as a dividend stock, given its lower dividend yield and higher payout ratio.

Analyst Ratings

This is a summary of current ratings and target prices for First Cash and its peers, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
First Cash 0 2 5 0 2.71
First Cash Competitors 172 697 1066 54 2.50

First Cash currently has a consensus price target of $64.00, indicating a potential downside of 5.88%. As a group, “Consumer Lending” companies have a potential upside of 41.55%. Given First Cash’s peers higher probable upside, analysts clearly believe First Cash has less favorable growth aspects than its peers.

Summary

First Cash peers beat First Cash on 8 of the 15 factors compared.

First Cash Company Profile

FirstCash, Inc., formerly First Cash Financial Services, Inc., is an operator of retail-based pawn stores in the United States and Latin America. The Company’s primary business is the operation of full-service pawn stores, which make small pawn loans secured by personal property, such as consumer electronics, jewelry, power tools, household appliances, sporting goods and musical instruments. The Company’s operates through two segments: the U.S. operations segment and the Latin America operations segment. The U.S. operations segment consists of all pawn and consumer loan operations in the United States and the Latin America operations segment consists of all pawn and consumer loan operations in Latin America, which includes operations in Mexico, Guatemala and El Salvador. In addition, some of the Company’s pawn stores offer small unsecured consumer loans or credit services products. The Company also operates consumer finance stores in Texas and Mexico.

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