EZCORP, Inc. (EZPW) provides pawn transactions in the U.S. and Latin America. Shares of the company have been trending lower this month after its CEO Jason A. Kulas resigned.
The company’s board has appointed Lachlan P. Given and John Blair Powell, Jr. as co-interim CEOs. While Powell will focus on store and digital operations, Given will focus on strategy, finance, and M&A.
EZCORP’s upcoming earnings for the first quarter are expected on February 2. Consensus estimates point to earnings per share of $0.14 for this period as compared to $0.13 a year ago.
With these developments in mind, let us take a look at the changes in EZCORP’s key risk factors that investors should know.
Risk Factors
According to the TipRanks Risk Factors tool, EZCORP’s top risk category is Finance & Corporate, contributing 43% to the total 28 risks identified. In its recent annual report, the company has changed three key risk factors.
EZCORP noted that it has an investment in Rich Data Corp (RDC) and an indirect investment in Simple Management Group (SMG). Consequently, its ability to recover investments in the companies hinges on their performance and their ability to raise capital either through debt or equity. If either of these companies is not successful, then EZCORP may have to recognize impairment on these investments.
The company highlighted that it regularly sees fluctuations in a number of its operating metrics. Factors such as the economic environment, competitive pressures, consumers’ tastes, and gold prices may affect EZCORP’s sales, profitability, and pawn redemption rates, which can adversely affect the company.
EZCORP also noted that public health issues such as the present COVID-19 pandemic could have an adverse impact on its liquidity, operations, and financials.
Compared to a sector average of 6%, EZCORP’s Ability to Sell risk factor is at 14%.
Blogger Opinions
TipRanks data shows that financial blogger opinions are 66% Bullish on EZCORP, compared to a sector average of 70%. Shares are down 17.1% over the past month.
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