FirstCash’s (FCFS)
headline results don’t look all that impressive, but there good things
going on with this large pawn lender. The company’s Latin American
operations continue to generate strong growth, while the integration of a
large U.S. acquisition is on pace to generate better margins and cash
flows in the years to come. At the same time, lending options for
FirstCash’s core customer base continue to remain relatively limited,
giving the company a good addressable market to drive future growth.
FirstCash
shares have done a little better than I’d expected, but I continue to
believe there’s a reasonable trade-off in place between risk and reward.
Although I do not believe that the shares are shockingly cheap, I
believe the prospect of high teens EPS growth and high single-digit
long-term FCF growth can support a decent return.
Read the full article here:
FirstCash's Balanced Growth/Value Model Continues To Work
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