Encore Capital Group: Sustained Tailwinds Warrant Small Position

Encore Capital Group shares have surged 65% year-to-date, reflecting strong market momentum. The guidance for 2026 looks stellar. Collections at $2.8 billion, an increase of 8% YoY. Earnings guidance of $13.00 per share, an increase of 19% YoY. I see two key secular tailwinds as being persistent, not temporary: high total consumer loan volume, along with elevated charge-off rates. This alone warrants a small position, in my opinion. Risks include a severely deteriorating collection environment, increased legal costs, and goodwill write-offs.

Shares of Encore Capital Group, Inc. ( ECPG ) have rallied a massive 65% year-to-date on the back of rising charge-offs and credit card debt at record levels. Since the company buys these debts, it thrives under This article was written by Apollonian Research 109 Followers Follow PhD in Law & Economics with a dissertation on corporate wrongdoing, paired with an accounting background and a lifelong interest in markets.I write almost exclusively about undercovered small and mid-cap names, currently concentrated in fintech and consumer lending, where legal, regulatory, and governance risk routinely moves the stock more than anything on the sell-side's model. Value, growth, secular trends, accounting shenanigans: if it fits that lens, I'm interested.