Can Higher Cash Collections Boost PRA Group's Q4 Earnings?

Nonperforming loan portfolio acquirer, PRA Group, Inc. PRAA, is set to report its fourth-quarter 2025 results on Feb. 26, 2026, after the closing bell. The Zacks Consensus Estimate for the to-be-reported quarter’s earnings and revenues is pegged at 50 cents per share and $304.18 million, respectively.

The fourth-quarter earnings estimate has remained stable over the past 60 days. The bottom-line projection indicates year-over-year growth of 6.4%. Also, the Zacks Consensus Estimate for quarterly revenues suggests a year-over-year increase of 3.7%.

For 2025, the Zacks Consensus Estimate for PRA Group’s revenues is pegged at $1.17 billion, implying a rise of 5.2% year over year. However, the consensus mark for current year EPS is pegged at $1.45, implying a decline 19% on a year-over-year basis.

PRA Group beat the consensus estimate for earnings in three of the trailing four quarters and missed once, with the average surprise being 1.7%, as you can see below.

PRA Group, Inc. Price and EPS Surprise

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

PRAA’s Q4 Earnings Whispers

Our proven model does not conclusively predict an earnings beat for PRA Group this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the chances of an earnings beat. That is not the case here, as you will see below.

PRAAhas an Earnings ESP of 0.00% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

You can see the complete list of today’s Zacks #1 Rank stocks here.

Q4 Factors to Note for PRA Group

PRA Group is expected to have witnessed improved cash collections, higher portfolio income and disciplined purchasing activity in the fourth quarter. Growing strength in Americas and Australia Core is expected to have benefited its collections. The Zacks Consensus Estimate for fourth-quarter total cash collections indicates 10.4% year-over-year growth.

Moreover, strong recent purchases at improved returns are likely to have aided its portfolio income. The Zacks Consensus Estimate for fourth-quarter portfolio income is pegged at $262.5 million, indicating a rise of 14.3% year over year.

The above-mentioned factors are likely to have positioned the company for year-over-year growth. However, the consensus mark for changes in expected recoveries currently stands at $35 million, down 36.7% year over year. Also, the consensus mark for other revenues is pegged at $3.1 million, down 62.6% from a year ago.

Total operating expenses are likely to have escalated in the quarter due to increased legal collection costs and other operating expenses, making an earnings beat uncertain.

How Did Other Stocks Perform?

Here are some other stocks in the broader Finance space that have already reported earnings for this quarter: Capital One COF, Blue Owl Capital Corporation OBDC and Ares Capital Corporation ARCC.

Capital One’s fourth-quarter 2025 adjusted earnings of $3.86 per share missed the Zacks Consensus Estimate of $4.12 due to higher expenses and provisions. However, the bottom line increased from $3.09 a year ago, thanks to higher net interest and non-interest income and a rise in loan balances.

Blue Owl Capital reported fourth-quarter 2025 adjusted EPS of 36 cents, which beat the Zacks Consensus Estimate by 1.9% but decreased 23.4% year over year. Total investment income advanced 13.5% year over year to $447.8 million. However, the positives were partly offset by elevated expenses.

Ares Capital’s fourth-quarter 2025 core earnings of 50 cents per share met the Zacks Consensus Estimate on higher total investment income. However, the bottom line fell 9.1% from the prior-year quarter on increased expenses.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research