PRA Group Inc (PRAA) shares are soaring 17.50% in pre-market trading on Tuesday, following the release of its impressive second-quarter 2025 financial results. The global purchaser and collector of nonperforming loans reported a significant earnings beat, driven by strong operational performance and a strategic asset sale in Brazil.
The company reported a GAAP earnings per share of $1.08 for Q2 2025, substantially exceeding the consensus estimate of $0.44. This remarkable figure was largely attributed to a non-recurring gain of $0.75 per share from the sale of PRA Group's Brazilian servicing affiliate. Even excluding this one-time gain, the company's normalized earnings outperformed expectations. Revenue for the quarter reached $287.69 million, up 24.4% year-over-year and surpassing analysts' projections of $279.34 million.
PRA Group's core business showed robust performance, with total cash collections increasing by 13.2% to $536.3 million. The company's European operations were particularly strong, with collections climbing 18.5%. Despite the positive results, PRA Group has adopted a more cautious approach to portfolio purchases, which declined by 8.7% compared to the same quarter last year. This strategic shift reflects management's focus on selectivity and quality in their investments. The market's positive reaction is further reinforced by JMP Securities maintaining their "Market Outperform" rating on PRA Group, signaling continued confidence in the company's prospects.
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