EZCORP Inc., a value play at your local pawn shop
- 6 Comment
As my portfolio is 100% cash from the recent trade of the BARE Covered Call, I was on the hunt for the next investment. I was able to uncover this next hidden gem by running my value scorecard screen, to find out this stock passes the majority of my value stock metrics.
EZCORP Inc. (EZPW) acquires, establishes, and operates pawnshops and credit services shops. These shops function as sources of consumer credit and as value-oriented specialty retailers, primarily selling previously owned merchandise. The company makes non-recourse loans secured by pledges of tangible personal property, and imposes a pawn service charge as compensation. This charge is calculated on the dollar amount and duration of the loan. The company operates more than 280 pawnshops and 334 payday loan stores.
Here is my completed scorecard:
As you can see, the only metrics that this equity is missing is the price to book ratio and no dividend payments. I can accept no dividend payments with the ROIC metrics this company is achieving.
With this passing grade, I have decided to purchase EZPW and add it to my real money portfolio.
Trade Summary:
Buy 100 Shares at $13.99 on October 21st, 2009 for a total investment of $1,409.95
S&P 500 Index Level at the time of purchase: $1,081.40
Follow my portfolio through updates to my net worth link.
Author Disclosure: I am currently long shares of EZPW
6 Comments on this post
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pfstock said:
I have the same comment that I did with your BARE post: The scorecard table is too small to read, and I was not able to click to enlarge it.
Some people might feel that it is unethical to invest in companies which operate pawn shops and offer payday loans. I don’t agree with that point of view, and again I wish you good luck in this investment!
Disclosure: I have no position in EZPW.
October 23rd, 2009 at 2:18 pm -
Elias said:
Just fixed the image source so that it gets bigger if you click the value scorecard table…sorry for the slight images problems. I will go back and fix the BARE posts….
October 25th, 2009 at 6:21 pm -
Sensual photography said:
Nice post! Really it’s a very good way to safe investment………..
November 1st, 2009 at 12:35 pm -
watch online tv said:
I am going to be selling my electric keyboard and my mandolin, would it be more wise and would i get the best money if I sold them online or if I sold them to my local pawn shop?
November 2nd, 2009 at 6:00 am -
men health magazine said:
Not a good idea at all if you need more than the undervalued loan they will grant you as most people lose their jewelry at a great loss because they can’t redeem the items.
November 6th, 2009 at 1:35 am
[...] into the 4th Quarter earnings call for my recent investment of EZPW, I decided to purchase a few out of the money put options representing a protective put [...]