Cash Converters International Ltd

Sustainable growth: Cash Converters International Ltd.’s (ASX: CCV) stock surged about 4% on February 19, 2018 as the group released its half-year results and reported for a net profit after tax of $9.4 million exceeding the guidance and above $9.2 million figure of H2 FY17. The total loan book growth to $155.7 million represented 35% rise from 30 June 2017 (with Medium Amount Credit Contract (MACC) loan book growth of 125.0%), and bad debt fell to 11.3% from 21.5%. CCV has been benefitting from the UK segment. The group continues to invest in brand, new products and technology to ensure that the trajectory of performance is maintained. Further, revenue and profit growth of the business in the second half are expected to deliver stronger net profit for H2 FY18 with support from additional funding secured during H1 FY18 that materially increases securitisation facility. Looking at the trading levels, we give a “Hold” at the current price of $0.39
 

Growth for H2 and beyond (Source: Company Reports)
 

Money3 Corporation Ltd

Growth in Secured Lending: National Credit Provider, Money3 Corporation Ltd.’s (ASX: MNY) stock rallied 8.8% on February 19, 2018 with the release of a rock-solid result with 12.3% increase in 1H FY18 net profit after tax to $15.5 million. Demand experienced by the secured auto loans business (revenue rise of 32.8%) drove the profit higher and the group’s gross loan book of $234.6 million represented an increase of 24.7% year on year. EBITDA margin improved significantly to 45.6%. MNY now aims to enhance its market share from 2% to about 3% in next one year with new debt facility of $150m providing headroom for growth. Given the potential, we put a “Hold” at the current price of $1.85
 

Rise in Dividends (Source: Company Reports)

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