GET DAILY SIGNALSPRA Group (PRAA) Turns Profitable in Q3 2026 After Prior-Year Loss
Key Takeaways
- PRA Group swung back to profitability in the third quarter of 2026, reporting net income attributable to the company of $14.9 million, versus a $407.7 million loss in the prior-year quarter, which had included a $412.6 million non-cash goodwill impairment charge.
- Diluted earnings per share (EPS) came in at $0.39, well below the Zacks Consensus Estimate of $1.07.
- Total revenues declined 8% year over year to $286.3 million, missing the consensus mark by roughly 13%.
- Total cash collections were $536 million, down about 1% from a year earlier but roughly 1% above management's internal expectations.
- Portfolio income grew 5% to $271 million, while estimated remaining collections (ERC), the projected future cash recoveries on owned loan portfolios, reached a record $8.8 billion, up 5%.
- The adjusted cash efficiency ratio improved more than 200 basis points to 63%, reflecting ongoing cost-reduction initiatives.
Why These Results Matter for Investors
PRA Group focuses on buying and collecting nonperforming loans at a discount, then recovering value over time. Its quarterly numbers offer insight into both the quality of those purchases and broader consumer credit conditions in the U.S. and Europe. The latest report also shows progress on the company’s “PRA 3.0” plan, which targets better cost control, stronger legal collections, and technology upgrades. After the large goodwill impairment in 2025 and a solid second-quarter 2026 beat, this print helps clarify whether momentum and margin gains can hold up.
What the Numbers Show
For the three months ended September 30, 2026, reported on November 5, 2026, PRAA recorded total revenues of $286.3 million. That was down 8% from $311.1 million a year earlier and below the roughly $331 million consensus estimate. Diluted EPS of $0.39 missed the Zacks Consensus Estimate of $1.07. Net income attributable to PRAA reached $14.9 million, compared with a net loss of $407.7 million in the same quarter last year.
The revenue drop stemmed mainly from a smaller contribution from “changes in expected recoveries,” which fell to $14 million from $51 million. Portfolio income rose 5% to $271 million, while cash collections totaled $536 million—about 1% lower year over year yet slightly above internal targets. Portfolio purchases came in at $229 million versus $255 million, and ERC hit a record $8.8 billion, up 5%. The adjusted cash efficiency ratio improved more than 200 basis points to 63%, and trailing-twelve-month adjusted EBITDA grew 9% to $1.4 billion. I also checked this using Tickeron’s AI Screener to see how the stock compares to others in the industry.
How the Market Is Reacting
Heading into the release, sentiment had been constructive after the strong second-quarter beat and seven consensus EPS beats in the prior eight quarters. Shares were up roughly 14% year to date by early November, and at least one analyst kept a Buy rating with a $26 price target. The third-quarter miss reflected a smaller “changes in expected recoveries” line rather than any clear operational weakness. Investors appear to be balancing the softer top line against solid cost discipline, the record ERC balance, and the return to positive net income. The near-term price action will likely depend on management’s tone during the earnings call.
What to Watch Going Forward
Investors should focus on how PRAA manages portfolio purchases relative to leverage and returns. Management has noted healthy but more competitive supply in the U.S. and European volumes returning toward pre-COVID levels. The company is tilting more purchases toward Europe for better relative net returns and estimates it will need to invest roughly $1 billion over the next 12 months to sustain current ERC levels.
Cost and funding trends remain key. Legal collection costs have risen sharply in recent years, though management expects that growth to moderate in the second half of 2026. Shortly after quarter-end, PRAA issued $400 million of senior notes due 2033, improving its debt maturity profile. Other items worth monitoring include the pace of digital collections, any further European ERC revisions, net leverage, and the effect of cost actions on the cash efficiency ratio and adjusted EBITDA. From what I see, these factors will shape the next several quarters.
Using AI Tools in My Research
One tool I’ve found particularly helpful when digging into earnings and sector trends is Tickeron’s AI Screener. It lets me quickly filter stocks by technical patterns, fundamentals, and AI-driven signals so I can put a single company’s results in broader context without spending hours on manual screens. I’ve used it a few times this earnings season to spot comparable names and check relative performance.
Disclaimer
The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer.
Contributor
Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.
PRAA in upward trend: price rose above 50-day moving average on November 02, 2026
PRAA moved above its 50-day moving average on November 02, 2026 date and that indicates a change from a downward trend to an upward trend. In 28 of 34 similar past instances, the stock price increased further within the following month. The odds of a continued upward trend are 82%.
Technical Analysis (Indicators)
Bullish Trend Analysis
The Stochastic Oscillator suggests the stock price trend may be in a reversal from a downward trend to an upward trend. 44 of 61 cases where PRAA's Stochastic Oscillator exited the oversold zone resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are 72%.
The Moving Average Convergence Divergence (MACD) for PRAA just turned positive on November 04, 2026. Looking at past instances where PRAA's MACD turned positive, the stock continued to rise in 28 of 38 cases over the following month. The odds of a continued upward trend are 74%.
Following a +2.23% 3-day Advance, the price is estimated to grow further. Considering data from situations where PRAA advanced for three days, in 199 of 299 cases, the price rose further within the following month. The odds of a continued upward trend are 67%.
PRAA may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
The Aroon Indicator entered an Uptrend today. In 117 of 179 cases where PRAA Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are 65%.
Bearish Trend Analysis
The Momentum Indicator moved below the 0 level on November 04, 2026. You may want to consider selling the stock, shorting the stock, or exploring put options on PRAA as a result. In 67 of 85 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are 79%.
The 10-day moving average for PRAA crossed bearishly below the 50-day moving average on November 04, 2026. This indicates that the trend has shifted lower and could be considered a sell signal. In 11 of 15 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are 73%.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where PRAA declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 76%.
Fundamental Analysis (Ratings)
The Tickeron Valuation Rating of 14 (best 1 - 100 worst) indicates that the company is seriously undervalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (0.735) is normal, around the industry mean (3.804). P/E Ratio (-3.043) is within average values for comparable stocks, (6.599). Projected Growth (PEG Ratio) (0.220) is also within normal values, averaging (3.918). Dividend Yield (0.065) settles around the average of (0.186) among similar stocks. P/S Ratio (0.577) is also within normal values, averaging (5.901).
The Tickeron Price Growth Rating for this company is 42 (best 1 - 100 worst), indicating steady price growth. PRAA’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is 70 (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Seasonality Score of 75 (best 1 - 100 worst) indicates that the company is slightly overvalued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron SMR rating for this company is 96 (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Profit vs. Risk Rating rating for this company is 100 (best 1 - 100 worst), indicating that the returns do not compensate for the risks. PRAA’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 78, placing this stock worse than average.
Notable companies
Industry description
Market Cap
High and low price notable news
Volume
Fundamental Analysis Ratings
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
Advertisement
General Information
a company which engages in the purchase, collection and management of portfolios of defaulted consumer receivables
Industry SavingsBanks