Metris Fattens Up on Fee Growth
Did Metris (MXT), the credit card lender to tainted borrowers, speed up recognition of fee revenue in an effort to goose second-quarter earnings?
Wednesday morning, the Minnetonka, Minn.-based company reported 63 cents in per-share profits in the second quarter, 19% ahead of the 53 cents in the year-ago period and 3 cents more than analysts expected. The stock jumped $1.60, or 4.3%, to $38.50.
Those earnings were aided by an unexpected jump in revenue from Metris' fee businesses, known as enhancement services. Revenue from enhancement services totaled $82.9 million in the second quarter, 6% above the $78.3 million in the first quarter. Enhancement services are particularly important because they are so lucrative, carrying a pretax profit margin in the region of 70%.
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Metris' stock in 2001
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