EZPW had a much better report than last quarter, when it missed the consensus barely due to a ticking up in credit losses. Sales and EPS both came in about 3% of the consensus. The company also provided good guidance for FY12 - 3.05-3.10 compared to a 3.01 consensus. This represents 20% growth - not bad for a stock trading at 10PE with very little debt.
While I was pleased with everything I heard for the most part and expect the market to react well, I need to point out that the guidance was boosted by $50mm of acquisitions over the past 40 days. When I do the math, it suggests that the guidance was just ok, not really an improvement, especially when I consider that the company is making several strategic investments (mainly related to an e-commerce effort).
30 looks to be a key level, a pivot-point of sorts on the stock. My target will go up a little on the higher guidance (45-->46), and optically this will look good to investors that like to see earnings momentum. I think that this stock should trade 34-37 right now, but that is asking for too much, too soon. More realistically, though, I think the stock can work to 33 pretty quickly. I think that people were spooked out of the stock by an irresponsible analysts multiple target reductions and a "sell" rating last month, and he now looks to be wrong.