Atlanticus (NASDAQ:ATLC) Posts Quarterly Earnings Results

Atlanticus (NASDAQ:ATLC) issued its earnings results on Thursday. The credit services provider reported $2.50 earnings per share (EPS) for the quarter, beating the consensus estimate of $2.42 by $0.08, Zacks reports. Atlanticus had a return on equity of 23.43% and a net margin of 5.86%.The firm had revenue of $744.31 million for the quarter, compared to analyst estimates of $716.35 million.

Here are the key takeaways from Atlanticus’ conference call:

• Record profitability: Second-quarter net income rose 67% year over year to $47.4 million, with revenue up 89% to $744 million and return on average equity of 28.1%, above the company’s 20% long-term target.
• The Mercury acquisition is performing ahead of expectations, with portfolio repricing, consumer adoption, overhead synergies, and technical integration progressing faster than modeled; most integration work is expected to be completed by mid-first quarter 2027.
• Growth remains strong beyond Mercury: legacy managed receivables increased 26% year over year, active accounts grew by more than 1 million, and the company added a record 790,000 new customers during the quarter.
• Credit performance remains broadly in line with models, with sequentially improved delinquencies and a combined principal net charge-off rate of 17.7%; management cautioned that delinquency and charge-off rates could rise modestly as receivables season and portfolio mix changes.
• Funding and liquidity remain favorable, supported by $645 million of cash and restricted cash, strong financing-partner demand, tighter ABS spreads, and the company’s first AAA-rated ABS bonds. However, intense competition and a more than 50% increase in industry direct-mail solicitations are pressuring response rates and acquisition costs.

Atlanticus Stock Up 0.4%

Shares of NASDAQ ATLC opened at $111.79 on Friday. The company has a quick ratio of 1.24, a current ratio of 1.24 and a debt-to-equity ratio of 1.08. The company has a market cap of $1.69 billion, a P/E ratio of 16.69 and a beta of 2.11. Atlanticus has a 52 week low of $47.50 and a 52 week high of $114.34. The business has a 50-day simple moving average of $97.77 and a two-hundred day simple moving average of $75.08.

Insider Buying and Selling

In other news, CAO Mitchell Saunders sold 10,000 shares of the stock in a transaction dated Monday, June 29th. The shares were sold at an average price of $102.20, for a total value of $1,022,000.00. Following the sale, the chief accounting officer directly owned 46,273 shares of the company’s stock, valued at approximately $4,729,100.60. This represents a 17.77% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which can be accessed through the SEC website. Also, CFO William Mccamey sold 10,000 shares of the firm’s stock in a transaction that occurred on Tuesday, June 30th. The shares were sold at an average price of $103.01, for a total transaction of $1,030,100.00. Following the completion of the transaction, the chief financial officer owned 127,410 shares of the company’s stock, valued at $13,124,504.10. This trade represents a 7.28% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. In the last ninety days, insiders have sold 75,000 shares of company stock valued at $7,868,627. Corporate insiders own 51.00% of the company’s stock.

Institutional Investors Weigh In On Atlanticus

A number of institutional investors and hedge funds have recently bought and sold shares of ATLC. Advisory Services Network LLC purchased a new stake in Atlanticus in the third quarter worth approximately $47,000. Jones Financial Companies Lllp bought a new stake in shares of Atlanticus in the 1st quarter worth approximately $71,000. BNP Paribas Financial Markets lifted its stake in Atlanticus by 334.8% in the second quarter. BNP Paribas Financial Markets now owns 1,735 shares of the credit services provider’s stock worth $95,000 after acquiring an additional 1,336 shares during the period. State of Wyoming bought a new stake in Atlanticus in the fourth quarter valued at $158,000. Finally, Franklin Resources Inc. bought a new stake in Atlanticus in the third quarter valued at $202,000. 14.15% of the stock is owned by hedge funds and other institutional investors.

Analyst Ratings Changes

A number of equities research analysts recently issued reports on the company. Zacks Research cut Atlanticus from a “strong-buy” rating to a “hold” rating in a research note on Monday, July 13th. Jefferies Financial Group increased their target price on shares of Atlanticus from $100.00 to $115.00 and gave the stock a “buy” rating in a research report on Wednesday, July 8th. B. Riley Financial reissued a “buy” rating on shares of Atlanticus in a research report on Thursday, May 14th. Weiss Ratings upgraded shares of Atlanticus from a “hold (c-)” rating to a “hold (c)” rating in a research note on Thursday, June 11th. Finally, Capital One Financial set a $144.00 price objective on shares of Atlanticus in a report on Monday, July 13th. One analyst has rated the stock with a Strong Buy rating, five have assigned a Buy rating and two have given a Hold rating to the company’s stock. Based on data from MarketBeat, Atlanticus presently has a consensus rating of “Moderate Buy” and an average target price of $126.00.

About Atlanticus

Atlanticus Holdings Corporation is a specialty financial services holding company that provides credit products and solutions to consumers across the United States. Through its subsidiaries, the company offers proprietary credit card programs, installment loan products and deposit accounts designed to serve customers who may have limited access to traditional credit. Atlanticus markets its offerings through a variety of channels, including direct‐to‐consumer online platforms, mail order, call centers and partnerships with retail and e-commerce businesses.

The company underwrites and services credit card portfolios under private-label and co-branded agreements, combining technology‐enabled underwriting with tailored customer service.