Market Overview

JPM: Cash America International Fully Valued Following Spin-Off

Share:

Cash America International Inc (NYSE: CSH) is fully valued after its recent spin-off of sub-prime lender Enova International, Inc. (NYSE: ENVA), an analyst said Monday.

JMP's David Scharf downgraded Cash America to Market Perform, from Outperform, saying likely earnings growth at Cash America doesn't support its current share price.

Cash America, which retains a 20 percent stake in Chicago-based Enova after the November 13 spin-off, traded recently at $24.66, down 2.1 percent.

Enova is off 17 percent since trading began. On Monday, Enova fell 1.5 percent, changing hands recently at $23.00.

Scharf said factoring in Cash America's 20 percent stake in Enova "remains a wild card," adding that his earlier Outperform rating had included improving results from both the pawn shop business as well as the Enova unit, which operates exclusively online.

Scharf noted that Street estimates of Cash America's future earnings are near or above the range offered recently by the company.

That "allows little room for error" for a stock with a relatively high ratio of price to earnings, Scharf said.

Cash America has noted that consumer advocacy groups as well as federal and state legislators have recently suggested tightening rules "so as to severely limit, if not eliminate" so-called payday and other high-interest loan products offered by pawnbrokers and online lenders.

Latest Ratings for CSH

DateFirmActionFromTo
Apr 2016JMP SecuritiesDowngradesOutperformMarket Perform
Apr 2016MacquarieUpgradesUnderperformNeutral
Oct 2015JMP SecuritiesMaintainsMarket Outperform

View More Analyst Ratings for CSH
View the Latest Analyst Ratings

 

Related Articles (CSH)

View Comments and Join the Discussion!

Posted-In: David Scharf JMP SecuritiesAnalyst Color Downgrades Analyst Ratings

Latest Ratings

StockFirmActionPT
IBIOCantor FitzgeraldInitiates Coverage On3.0
WNSNeedhamMaintains85.0
THCUBSMaintains60.0
UPLDCanaccord GenuityMaintains57.0
EJefferiesInitiates Coverage On
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com