MODEL VERDICT
Encore Capital Group, Inc. (ECPG)
Relative Valuation•Peer multiples, Monte Carlo simulation & quality-adjusted fair value
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Composite score derived from valuation, quality, and risk factors
Quantitative model thresholds · For educational and research purposes only
Each row records the model's monthly assessment. High Conviction = the model detected notable undervaluation vs peers. Neutral = no notable divergence was found. The return column shows the actual price change over 90 days for reference. This is a quantitative observation log — not investment advice.
| Date | Assessment | Score | Price | Status | 90d Fwd Return |
|---|---|---|---|---|---|
| May 1, 2026 | MODERATE | 0.70 | $83.30 | CURRENT | — |
| Apr 24, 2026 | MODERATE | 0.63 | $83.73 | CURRENT | — |
| Apr 17, 2026 | MODERATE | 0.70 | $80.75 | CURRENT | — |
| Apr 16, 2026 | MODERATE | 0.70 | $78.69 | CURRENT | — |
| Apr 10, 2026 | NEUTRAL | 0.45 | $75.43 | CURRENT | — |
Historical model observations for research purposes only. Past quantitative patterns do not predict future results. Not a recommendation to buy, sell, or hold any security.
| Methodology | Fair Value | vs Current | Weight | Quality | Status |
|---|---|---|---|---|---|
| Industry Median P/E 8 industry peers | $235.77 | +183.0% | 30% | A | Peer Data |
| Price / Book 9 industry peers | $39.19 | -53.0% | 25% | B | Model Driven |
| Price / Tangible Book 8 bank peers | $23.70 | -71.5% | 20% | B+ | Bank Primary |
| Earnings Yield 8 industry peers | $230.29 | +176.5% | 8% | B | Data |
| Forward P/E 9 analyst estimates | $116.47 | +39.8% | 7% | A- | Analyst Est. |
| Weighted Output Blended model output | $112.66 | +35.2% | 100% | 86 | SIGNIFICANTLY UNDERVALUED |
| EPS Growth ↓ | P/E Multiple → | 4× | 6× | 8× (Current) | 10× | 12× |
|---|---|---|---|---|---|
| Bear Case (4%) | $45 | $68 | $91 | $114 | $136 |
| Conservative (7%) | $47 | $70 | $93 | $116 | $140 |
| Base Case (10.3%) | $48 | $72 | $96 | $120 | $144 |
| Bull Case (14%) | $50 | $75 | $99 | $124 | $149 |
Cross-sectional regression predicting expected multiples based on growth, margins, ROIC, and beta.
| Multiple | Avg | Median | Min | Max | Std |
|---|---|---|---|---|---|
| P/E Ratio | 5.88 | 5.83 | 4.98 | 6.63 | 0.67 |
| EV/EBIT | 38.85 | 8.79 | 1.80 | 201.77 | 72.50 |
| EV/EBITDA | 18.90 | 7.88 | 1.72 | 74.84 | 25.64 |
| P/FCF | 8.18 | 8.97 | 4.44 | 11.86 | 2.64 |
| P/FFO | 4.93 | 4.85 | 4.48 | 5.33 | 0.33 |
| P/TBV | 5.62 | 4.39 | 2.90 | 12.39 | 3.36 |
| P/AFFO | 6.00 | 5.61 | 4.93 | 7.61 | 1.09 |
| P/B Ratio | 1.27 | 1.28 | 1.01 | 1.63 | 0.23 |
| P/S Ratio | 0.90 | 0.87 | 0.73 | 1.20 | 0.15 |
Based on our peer multiples analysis with 14 valuation metrics, the model estimates ECPG's fair value at $112.66 vs the current price of $83.30, implying +35.2% upside potential. Model verdict: Significantly Undervalued. Confidence: 86/100. This is a quantitative estimate, not a recommendation.
The blended fair value of $112.66 is calculated using four lenses: industry median multiples (40%), historical multiples (30%), forward estimates (20%), and quality-adjusted multiples (10%). Monte Carlo simulation (10,000 iterations) gives a range of $86.88 (P10) to $173.57 (P90), with a median of $112.81.
ECPG's current P/E of 7.6x compares to the industry median of 21.6x (8 peers in the group). This represents a -64.7% discount to the industry. The historical average P/E is 5.9x over 5 years. Signal: Deep Discount.
15 analysts cover ECPG with a consensus rating of Buy. The consensus price target is $85.00 (range: $70.00 — $100.00), implying +2.0% upside from the current price. Grade breakdown: Strong Buy (0), Buy (12), Hold (3), Sell (0), Strong Sell (0).
The model confidence score is 86/100, based on: data completeness (24), peer quality (25), historical depth (20), earnings stability (15), and model agreement (2). Cyclicality penalty: -0 points. The model shows strong agreement across inputs.
The model flags several key risks: (1) Multiple compression: ECPG trades at the 2500th percentile of its historical P/E range. A reversion to median (5.9×) would imply significant downside. (2) Macro/regulatory risks are not captured in this model but remain material.
Peak earnings risk refers to the possibility that ECPG's current profitability is above its sustainable long-term trend. The model detects a margin Z-score of +0.5σ, meaning margins are 0.5 standard deviations above their historical average. If margins revert to the 5-year mean (7.0%), the model estimates fair value drops by 6310.0% to approximately $31. This isn't a prediction — it's a scenario analysis.
No. This dashboard is a quantitative research tool for educational and informational purposes only. It is not investment advice, a solicitation, or a recommendation to buy, sell, or hold any security. The operator of this platform is not a registered investment advisor (RIA), broker-dealer, or financial planner. All model outputs, fair value estimates, signals, and scenarios are the result of automated quantitative computations and should not be construed as professional financial guidance. You should consult a qualified, licensed financial advisor before making any investment decisions. Past model performance is not indicative of future results.