$FirstCash (FCFS.US)$In the traditional pawnbroking business...

The income statement shows that interest expenses surged 1.2 times to 70 million in 2022, reaching 25% of operating profit. The interest burden is very heavy. There was another equity income of 110 million in 2022. Only then did net profit increase to 250 million. Excluding the impact of equity income, net profit should only be around 170 million.

In the past 5 years, the balance ratio increased from 37.5% to 51.9%, goodwill and other intangible assets increased from 1.06 billion to 1.92 billion in 2021Q4. Large acquisitions were carried out at the end of 2021. The surge in revenue and net profit in 2022 should have come from this. Currently, goodwill and other intangible assets have surpassed net assets.

Long-term loans of $1.29 billion, accounting for 71% of net assets of $1,808 million. Considering the amount of net assets, the leverage ratio is not low.

The net cash flow operating amount over the past five years was basically the same as the net investment amount, and there was no shareholder surplus.

Currently, the price-earnings ratio is 16.8. Considering that the surge in 2022 should have come from acquisitions, sustainability is still unknown, so we can wait a few more quarterly reports to make a judgment.