Financials
Cash Converters International (CCV)
Cash Converters International Limited is a global operator in the second-hand goods and personal finance industries. The company's core services include pawnbroking, the sale of pre-owned goods through corporate and franchise stores, and the provision of personal finance products such as unsecured personal loans (Small and Medium Amount Credit Contracts) and vehicle financing. While operating internationally, its primary market is Australia.
Market Cap
A$220M
Shares on Issue
N/A
Price Chart
AI Analysis
As a small-cap company with a A$220M market capitalization, Cash Converters (CCV) operates a dual-revenue stream model that is sensitive to economic conditions. Its personal finance division, particularly the loan book, is the primary driver of profitability, benefiting from consumer demand for short-term credit. Recent performance has been influenced by cost-of-living pressures, which can increase loan demand but also elevate the risk of defaults. Key metrics for investors to monitor include loan book growth, net bad debt as a percentage of receivables, and the performance of its corporate-owned retail store network.
CCV's growth outlook is centered on the expansion of its profitable personal loan book and leveraging its well-known brand to enhance its digital lending and online retail presence. The company aims to balance growth with prudent risk management, particularly in the face of potential economic headwinds. Key catalysts include continued demand for alternative credit solutions, successful integration of technology to streamline operations, and a stable regulatory environment for the consumer credit industry. Strategic focus remains on optimizing the mix between franchise and corporate stores and growing market share in vehicle financing.
Bull Case
- • Counter-cyclical business model benefits from increased demand for short-term loans and affordable second-hand goods during periods of economic stress and high inflation.
- • Strong brand recognition and an extensive physical store network provide a competitive advantage in the sub-prime lending and pawnbroking markets.
- • A consistent dividend history and focus on growing the high-margin personal finance loan book offer potential for both income and capital growth.
Bear Case
- • Significant regulatory risk, as changes to consumer credit laws, interest rate caps, or responsible lending obligations could materially impact profitability.
- • Exposure to credit risk, where an economic downturn could lead to higher loan defaults and increased bad debt provisions, eroding earnings.
- • Intense competition from other non-bank lenders, 'Buy Now Pay Later' (BNPL) providers, and online marketplaces for second-hand goods.
Recent Announcements
Quarterly Activities Report
Highlights production updates, capital allocation priorities, and FY guidance commentary.
Investor Presentation
Strategic outlook with market positioning and growth pipeline.
FAQs
What does CCV do?
Cash Converters International (CCV) operates a dual business model. It is Australia's largest pawnbroker and second-hand goods retailer, while also providing personal financial services, including small and medium amount credit contracts (SACCs and MACCs) and vehicle financing.
Is CCV a good investment?
CCV presents a speculative investment case. Its counter-cyclical nature may appeal during economic uncertainty, but it faces significant regulatory risks, credit default risks, and competition. Potential investors should weigh the growth in its loan book and strong brand against the inherent risks of the non-bank lending sector.
What drives CCV's share price?
CCV's share price is primarily influenced by its financial performance, specifically the growth and quality of its loan book, net interest margins, and retail sales. Macroeconomic factors like unemployment rates and consumer sentiment, along with regulatory changes in the consumer credit space, are also major drivers.
Key Metrics
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