PRA Group Q2 Earnings Beat Estimates on Rising Cash Collections

PRA Group, Inc. PRAA reported second-quarter 2025 earnings per share (EPS) of $1.08, which beat the Zacks Consensus Estimate by 74.2%. The bottom line rose from 54 cents per share a year ago.

Total revenues improved 1.2% year over year to $287.7 million. The top line beat the consensus mark by 4.2%.

The strong quarterly results benefited from improved cash collections and higher portfolio income. A significant increase in other revenues also aided the results. However, the upside was partly offset due to rising operating costs attributed to higher legal collection costs and fees.

PRA Group, Inc. Price, Consensus and EPS Surprise

PRA Group, Inc. price-consensus-eps-surprise-chart | PRA Group, Inc. Quote

PRA Group’s Quarterly Operational Update

PRA Group’s cash collections were $536.3 million, which advanced 13.2% year over year and beat the Zacks Consensus Estimate of $519 million. The metric was aided by higher cash collections across the United States and Europe.

Portfolio income rose 19.9% year over year to $250.9 million and surpassed the consensus mark of $249 million. Other revenues of $3.5 million increased significantly from the figure of $1.6 million a year ago and beat the consensus mark of $1.2 million.

Total operating expenses rose 3.9% year over year to $202.6 million due to increased compensation and benefits expenses, legal collection costs, legal collection fees, professional and outside services costs, and other operating expenses.
PRAA’s net income of $45.7 million rose 82% year over year in the second quarter.

The company purchased nonperforming loan portfolios of $346.5 million, which declined 8.7% year over year. The cash efficiency ratio improved 355 basis points year over year to 62.4%. The estimated remaining collections amounted to $8.3 billion at the second-quarter end, up 21.9% year over year.

PRAA’s Financial Update (As of June 30, 2025)

PRA Group exited the second quarter with cash and cash equivalents of $131.6 million, which advanced from the figure of $105.9 million at 2024-end. It had $840.7 million remaining under its credit facilities at the second-quarter end.

Total assets of $5.4 billion increased from the 2024-end level of $4.9 billion.

Borrowings were $3.6 billion, which rose from the figure of $3.3 billion as of Dec. 31, 2024.

Total equity of $1.4 billion improved 17% from the 2024-end level.

PRAA’s 2025 Outlook

Earlier, management estimated portfolio investments of $1.2 billion for 2025. PRAA forecasted cash collections to witness high-single-digit growth as a result of strong portfolio purchases and benefits from cash-generating initiatives.

The cash efficiency ratio was projected to be more than 60% in 2025. The company expected a return on average tangible equity of around 12%.

PRAA’s Zacks Rank & Key Picks

PRAA currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader finance space are Lazard, Inc. LAZ, Evercore Inc EVR and Acadian Asset Management Inc. AAMI, each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Lazard’s current-year earnings of $2.47 per share has witnessed two upward revisions in the past 30 days against none in the opposite direction. Lazard beat earnings estimates in three of the trailing four quarters and missed once, with the average surprise being 43.9%. The consensus estimate for current-year revenues is pegged at $3.1 billion, implying 5.6% year-over-year growth.

The Zacks Consensus Estimate for Evercore’s current-year earnings of $12.41 per share has witnessed two upward revisions in the past 30 days against no movement in the opposite direction. Evercore beat earnings estimates in each of the trailing four quarters, with the average surprise being 44.1%. The consensus estimate for current-year revenues is pegged at $3.5 billion, calling for 15.9% year-over-year growth.

The Zacks Consensus Estimate for Acadian Asset Management’s current-year earnings is pegged at $3.72 per share, implying 34.8% year-over-year growth. In the past 60 days, Acadian Asset Management has witnessed one upward estimate revision against none in the opposite direction. The consensus mark for the current-year revenues is pegged at $620.9 million, calling for 22.8% year-over-year growth.

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