Post by
retiredcf on Apr 28, 2022 8:50am
CIBC
goeasy (Outperformer, $200 Price Target)
goeasy has not yet released its reporting date and conference call information. Our Q1
adjusted diluted EPS estimate stands at $2.88, slightly above consensus of $2.82.
During the Q4/21 earnings call, management provided guidance for the first quarter which
entailed: 1) loan growth of $80 million-$100 million (up from $31 million in Q1/21); 2) a net
charge-off rate of 9%-10%; and, 3) a total yield on the consumer loan portfolio of
38.5%-39.5%. We believe these are the KPIs that will have the greatest influence on the
market reaction to Q1 results (particularly loan growth and credit performance).
We recently initiated coverage on GSY with our report found here. We believe that the macro
backdrop appears conducive to strong credit demand, and we could see upside to our base
case forecast and management’s guidance for Q1 results. Commentary surrounding the
outlook for delinquencies and net charge-offs will undoubtedly be an important area of focus
as investors attempt to better understand how credit will perform in the context of
accelerating inflation trends and normalized spending patterns. We continue to monitor the
trajectories of inflation and wage growth to inform our expectations on this front