NEW YORK (AP) ¿ Shares of bad-debt collector Portfolio Recovery Associates Inc. jumped nearly 8 percent in thin trading Wednesday after an analyst upgraded the stock to "Buy" from "Neutral," saying he expected the company to report solid operating profit later this month.
SunTrust Robinson Humphrey analyst Mark Hughes expects the Norfolk, Va., company to report earnings per share of 75 cents, down 4 cents from his prior estimate due to a one-time charge.
Wall Street analysts polled by Thomson Reuters expect profit of 77 cents per share.
In 2008, the company earned $2.97 per share, and 78 cents in the first quarter.
Indicators are good for a rise in collections, which should boost operating profit, Hughes said. Wages for collectors of bad debt, which are based on performance, rose 4.6 percent in February. Meanwhile, federal tax refunds, which are a key driver of first-quarter collections, he said, are up 14 percent through March 20, compared with a 6 percent gain last year.
Hughes expects 2010 earnings-per-share estimate of $3.50. Wall Street analysts expect $3.79 per share.