FirstCash Posts Better Results On Accelerating LatAm Growth

After a disappointing fourt quarter, FirstCash (FCFS) restored some of its growth luster with a better set of first quarter results that included an acceleration of growth in the Latin American store base and improved margins in the U.S. stores. FirstCash remains a solid play on the Mexican consumer and a somewhat countercyclical play on the U.S. economy, though the risk of regulatory changes and new fintech competition shouldn’t be excluded.

At over 14x forward EBITDA, FirstCash shares look more like a solid hold than a clear-cut buy today given where the valuation is. That said, the arrow is moving in the right direction with respect to the underlying momentum in the business, which is why I’m willing to hold on even if discounted cash flow modeling suggests suboptimal returns.

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FirstCash Posts Better Results On Accelerating LatAm Growth