PRA Group (PRAA) Stock Forecast & Price Target

PRA Group Inc has demonstrated impressive growth metrics, with estimated remaining collections (ERC) and adjusted EBITDA indicating strong operational performance that reflects the company's strategic initiatives over the past two years. Collection revenues reached $499 million, showing a year-over-year increase of approximately 15%, despite being slightly below expectations, while notable strength in European markets contributed positively to overall performance. Furthermore, the company has shown consistent improvements in margins and purchase volumes, alongside double-digit growth in collections and cash earnings, which underlines a robust financial trajectory moving forward.

PRA Group Inc. experienced a significant earnings shortfall, reporting adjusted earnings of $0.09 compared to an estimated $0.54, primarily driven by a 4% decline in collections. Additionally, the company's management revised its full-year guidance for Return on Average Tangible Equity downward from 12% to below that benchmark, reflecting caution in response to a disappointing first-quarter performance and post-tariff uncertainties. Furthermore, the portfolio yield of 23.3% fell short of expectations, contributing to a revenue of $270 million, which was also below the anticipated $296 million.