EZCORP Acquires Controlling Interest in Founders One
EZCORP announced the acquisition of a controlling interest in Founders One. Founders, through its subsidiary, Simple Management Group, led by CEO John Thedford, operates 105 pawn stores in the U.S. and 11 additional countries. The stores, which operate predominantly under the names "La Familia Pawn and Jewelry" and "CashWiz," offer traditional pawn loans, buy/sell transactions, and, in Puerto Rico, auto pawn and auto title loans. EZCORP has maintained a preferred equity investment in Founders since October 2021. At closing of the transaction on January 2, 2026, EZCORP converted its existing $45 million of preferred equity and $10 million of notes receivable to common equity in Founders and contributed an additional $9.4 million in cash, increasing its ownership in Founders and enabling Founders' purchase of additional shares in SMG. Also associated with the transaction, EZCORP entered into a three-year, senior secured debt facility to provide SMG $156.4 million in funding at 13% per annum, replacing SMG's third-party debt facility and debt owed to its shareholders and EZCORP. EZCORP funded the transactions out of its cash resources and now owns a majority 87.7% interest in Founders, which controls SMG with an 85.1% ownership interest. Accordingly, EZCORP will consolidate SMG's financial results going forward, which will meaningfully contribute to the Company's earnings. Based on unaudited results for the nine months ended September 30, 2025, Founders generated revenue of $127 million and gross profit of $66 million. For the full year ended fiscal 2024 (unaudited), Founders generated revenue of $147 million and gross profit of $79 million, reflecting growth of approximately 34% and 29%, respectively, compared to fiscal 2023. Following this transaction, EZCORP now operates a total of 1,488 pawn stores across 16 countries.
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EZCORP Offers $22.50 Call Option with 7.34% Potential Return
- Options Contract Analysis: The current bid for EZCORP's $22.50 call option stands at $0.75, and if an investor buys EZPW shares at $21.66 and sells this option, they could achieve a total return of 7.34% by the April 17 expiration, highlighting the attractiveness of this strategy.
- Risk and Reward: With the strike price approximately 4% above the current stock price, there is a possibility that the option may expire worthless, allowing the investor to retain both the shares and the premium collected, which could represent an additional 3.46% return or an annualized yield of 12.64%, enhancing the investor's profit potential.
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EZCORP Reports 27% Annual EPS Growth, Enhancing Investor Confidence
- Profitability Improvement: EZCORP has achieved a remarkable 27% annual growth in earnings per share (EPS) over the past three years, indicating a sustained improvement in profitability that may attract more investor interest.
- EBIT Margin Growth: The company's EBIT margin has increased from 9.8% to 12% in the last 12 months, reflecting enhanced operational efficiency and potentially boosting investor confidence in the company's future profitability.
- Revenue Growth Trend: With revenues on an upward trajectory, combined with the growth in EPS and EBIT, EZCORP demonstrates increasing competitiveness in the market, suggesting a promising outlook for sustainable financial performance.
- Insider Ownership: EZCORP insiders hold shares worth $122 million, indicating a strong alignment of interests between management and shareholders, which may further enhance investor trust in the company's strategic direction.
