Dollar Financial Corporation (NASDAQ: DLLR) operates
over 1,450 financially-oriented service stores in the U.S., Canada, Ireland and the U.K. Its customers are typically low to moderate income service sector earners, who don't use, or have access to banks. Services include check cashing, short-term consumer loans, money order/transfer products, reloadable debit cards, electronic tax filing, bill payment services and legal document processing. The company does business under the names Money Mart, Loan Mart, Insta-Cheques and Money Shop.
Dollar Financial pleased investors last week, when it reported fiscal Q4 EPS of 59 cents and revenues of $150.3 million. Analysts had been looking for 58 cents and $136.3 million. The CEO noted that fiscal 2008 brought record annual revenues and a record net income. Management also guided FY09 revenues to $595-$625 million, versus Street consensus of $586.28 million. JMP Securities subsequently reiterated its "market outperform" rating on the stock. Jefferies and Roth Capital reiterated their "buys".
DLLR shares
popped into a bullish "flag" consolidation pattern on the news. Prices frequently exit flags moving in the same direction they were traveling on entry. In this case, that would be to the upside.
Altogether, brokers now recommend the issue with three "strong buys", five "buys" and one "hold". Analysts see a 15% growth rate, through the next year. The DLLR P/E ratio (8.04), PEG ratio (0.58), Price to Sales ratio (0.80), Price to Book ratio (2.23), Price to Cash Flow ratio (5.81), Price to Free Cash Flow ratio (6.99), Sales Growth rate (23.00%), EPS Growth rate (22.92%), Operating Margin (17.03%) and Return on Equity (32.44%) compare favorably with industry, sector and S&P 500 averages. Over the past 52 weeks, the stock has traded between $15.02 and $33.04. A stop-loss of $16.75 looks good here.
Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com. He does not hold a position in the stock discussed above.










