Atlanticus Holdings Surprises Investors with Strong Quarterly Earnings

Quarterly Results Exceed Expectations

Atlanticus Holdings Corporation (ATLC) reported quarterly earnings of $1.27 per share, surpassing the Zacks Consensus Estimate of $1.23 per share. This result marks an increase compared to earnings of $1.03 per share for the same quarter last year. These results are adjusted for non-recurring items.

The earnings surprise of 3.25% demonstrates Atlanticus’s ability to outperform predictions. Just last quarter, analysts expected earnings of $0.87 per share, but Atlanticus delivered $0.99 per share, showing a remarkable surprise of 13.79%.

Consistent Performance in Earnings Estimates

In fact, Atlanticus has exceeded consensus EPS estimates in all four of the last quarterly reports. The company, part of the Zacks Financial – Miscellaneous Services industry, posted revenues of $350.95 million for the quarter ending September 2024. This revenue surpassed the Zacks Consensus Estimate by 7.44% and grew from $294.91 million in the previous year. Over the past four quarters, Atlanticus has consistently topped consensus revenue estimates three times.

The stock’s price movement following this earnings release, as well as expectations for future earnings, will depend heavily on insights shared by management during the upcoming earnings call.

Despite the positive earnings report, Atlanticus’s shares have increased by about 8% since the start of the year, in comparison to the S&P 500’s impressive gain of 24.3%.

Looking Forward: What’s Next for Atlanticus?

Although Atlanticus has fallen behind the market’s performance this year, investors may be wondering about the company’s future stock outlook.

There are no straightforward answers, but one measure investors can use is the company’s earnings outlook. This involves current consensus earnings predictions for upcoming quarters and any recent changes to those expectations.

Research shows a strong link between short-term stock movements and trends in earnings estimate revisions. Investors can monitor these revisions independently or use a reliable rating system like the Zacks Rank, known for its effectiveness in tracking earnings estimate changes.

Before this earnings release, the trend of estimate revisions for Atlanticus was unfavorable. While the latest earnings report could change this trend, the current status has resulted in a Zacks Rank #4 (Sell) for the stock, suggesting it is expected to underperform the market in the near term. For those interested, the full list of Zacks #1 Rank (Strong Buy) stocks is available online.

It will be crucial to observe how estimates for upcoming quarters and the current fiscal year adjust moving forward. Currently, the consensus EPS estimate stands at $1.22, with expected revenues of $338.01 million for the next quarter and $4.54 per share with $1.27 billion in revenues for the fiscal year overall.

Investors should also consider that the overall industry outlook can significantly influence stock performance. The Zacks Industry Rank places Financial – Miscellaneous Services in the top 31% of over 250 Zacks industries, highlighting that industries in the top half tend to outperform those in the bottom half by over two to one.

StoneX Group’s Upcoming Results

Another player in the same industry, StoneX Group Inc. (SNEX), is set to report results for the quarter ending September 2024. Analysts predict its quarterly earnings will come in at $2.05 per share, reflecting a year-over-year increase of 26.5%. The EPS estimate has been adjusted 9% higher in the last month. StoneX Group’s forecasted revenues stand at $874.7 million, reflecting a 12.4% increase compared to the previous year’s quarter.

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The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.