Stephen Simpson, CFA
Long only, growth at reasonable price, value, research analyst

Old Faithful Portfolio Recovery Associates Does It Again

The kind of performance Portfolio Recovery Associates (NASDAQ:PRAA) delivers just doesn't get boring. Although debt recovery is not a well-liked business by any stretch, PRA has done a remarkable job of refining its model so as to identify only those who can pay their debts, and the extent to which those customers are likely to respond to particular collection methodologies. Moreover, PRA has done a very good job of adhering to above-average standards such that it is one of the preferred buyers in the market and a likely beneficiary of rule/regulatory changes that could push some competitors out of the market.

Still, it's not as though the shares are notably cheap. The valuation model I use is very...

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