NEW YORK (TheStreet) -- Portfolio Recovery Associates (PRAA) was surging 15% to $58.17 on Thursdayg after the financial and businesses services company reported fourth-quarter earnings that surpassed analysts' expectations.
Portfolio Recovery reported net income of 91 cents a share, ahead of the Zacks consensus estimate of 89 cents. A year earlier, earnings were 70 cents a share. Revenue jumped almost 20% to $184.9 million, but came in just short of the Zacks consensus estimate of $186 million.
The company also received a boost from the announcement that it would acquire Aktiv Capital, an Oslo-based debt investment company, for $880 million. JMP Securities said in a research note on Thursday that the deal should be immediately accretive and that it should provide much-needed diversification. The firm reiterated its $72 target price and "outperform" rating on Portfolio Recovery after what it called "a positive and transformative acquisition by the company."
TheStreet Ratings team rates PORTFOLIO RECOVRY ASSOC INC as a "buy" with a ratings score of A. TheStreet Ratings Team has this to say about its recommendation:
"We rate PORTFOLIO RECOVRY ASSOC INC (PRAA) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth, compelling growth in net income and expanding profit margins. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results."