PRA Group Q4 Earnings Beat Estimates on Strong Portfolio Income

PRA Group, Inc. PRAA reported fourth-quarter 2025 earnings per share (EPS) of $1.46, which outpaced the Zacks Consensus Estimate by a whopping 192%. The bottom line increased more than threefold year over year.

Total revenues amounted to $333.4 million, which advanced 13.7% year over year. The top line surpassed the consensus mark by 9.6%.

The quarterly results were aided by strong cash collections from the United States and Europe. Portfolio income growth also contributed to the upside.  However, the upside is partly offset by an elevated expense level and a sharp decline in nonperforming loan purchases.

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 rose 13.6% year over year to $531.7 million, higher than the Zacks Consensus Estimate of $517 million. The metric was aided by higher cash collections stemming from investments in the U.S. legal collections channel, along with strong contributions from Europe.

Portfolio income of $262.8 million grew 14.4% year over year and matched the consensus mark. Other revenues came in at $6.7 million, which tumbled 19% year over year but beat the consensus mark of $3.1 million.

Total operating expenses rose increased 4.4% year over year to $207.8 million in the quarter under review due to higher legal collection costs, legal collection fees, agency fees, and professional and outside services costs.

PRAA’s net income of $59.2 million increased nearly threefold year over year. 

The company purchased nonperforming loan portfolios of $314.8 million, which fell 27.2% year over year. The adjusted cash efficiency ratio improved 250 basis points year over year to 61.3%. The estimated remaining collections amounted to $8.6 billion at the fourth-quarter end, which advanced 15.4% year over year.

PRAA’s Financial Update (As of Dec. 31, 2025)

PRA Group exited the fourth quarter with cash and cash equivalents of $104.4 million, which dipped 1.4% from the figure at 2024-end. It had $1.1 billion remaining under its credit facilities at the fourth-quarter end.

Total assets of $5.1 billion increased 3.5% from the 2024-end level.

Borrowings were $3.7 billion, up 11.1% from the figure as of Dec. 31, 2024.

Total equity of $1 billion tumbled 12.9% from the figure at the end of 2024.

Share Repurchase Update

The company conducted share repurchases of $20 million in 2025.

PRA Group’s Full Year Results

For 2025, total revenues rose 7.8% year over year to $1.2 billion. Portfolio income of $1 billion climbed 18.2% year over year. PRAA incurred a net loss per share of $7.79 against a net income of $1.79 per share recorded in 2024.

PRAA’s Zacks Rank

PRA Group currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other Finance Sector Releases

Of the other Finance sector players that have reported fourth-quarter results so far, the bottom-line results of Synchrony Financial SYF, Virtu Financial, Inc. VIRT and Blue Owl Capital Corporation OBDC beat the respective Zacks Consensus Estimate.

Synchrony Financial reported fourth-quarter 2025 adjusted EPS of $2.18, which surpassed the Zacks Consensus Estimate by 8.1%. The bottom line increased from $1.91 per share a year ago. Net interest income was $4.8 billion, which grew 3.7% year over year. However, it missed the consensus mark by 0.6%. Retailer share arrangements of Synchrony advanced 19% year over year to $1.1 billion in the quarter under review. Total loan receivables of $103.8 billion slipped 0.9% year over year. 

Total deposits dipped 1.1% year over year to $81.1 billion and fell short of our estimate of $81.5 billion. Synchrony’s purchase volume rose 3.2% year over year to $49.5 billion. Interest and fees on loans totaled $5.5 billion, which increased 1% year over. Net interest margin improved 82 basis points (bps) year over year to 15.8%.  Home & Auto period-end loan receivables decreased 5.4% year over year. Digital period-end loan receivables rose 2.4% year over year. 

Virtu Financial’s fourth-quarter adjusted EPS of $1.85 beat the Zacks Consensus Estimate by 44.8%. The bottom line increased 62.3% year over year. Adjusted net trading Income rose 34% year over year to $613.4 million. Revenues from commissions, net, and technology services rose 12.1% year over year to $157.4 million.  Interest and dividend income of $143.9 million increased 16.3% year over year. 

Adjusted EBITDA increased 55.9% year over year to $442 million. Adjusted EBITDA margin improved year over year to 72.1% from 61.9% a year ago. The Market Making unit’s adjusted net trading income totaled $488.67 million in the fourth quarter, climbing 40.5% year over year. The unit’s revenues increased 13.7% year over year to $803.4 million. The Execution Services segment recorded adjusted net trading income of $124.8 million, representing an increase of 13.6% year over year. The unit’s total revenues rose 15.8% year over year to $158.2 million. 

Blue Owl Capital reported fourth-quarter 2025 adjusted EPS of 36 cents, which beat the Zacks Consensus Estimate by 1.9%. However, the bottom line decreased 23.4% year over year. Total investment income advanced 13.5% year over year to $447.8 million. The top line beat the consensus mark by 0.4%. Adjusted net investment income of $184 million fell 0.1% year over year. New investment commitments were $684 million across 12 new portfolio companies and 17 existing ones.

Blue Owl Capital ended the fourth quarter with investments in 234 portfolio companies, backed with an aggregate fair value of $16.5 billion. Based on the fair value, the average investment size in each portfolio company was $70.4 million as of Dec. 31, 2025. OBDC recorded an adjusted net increase in net assets resulting from operations of $119.1 million, which decreased 23.1% year over year.

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