AFRM - Atlanticus Holdings: We Are Encouraged By Our Review Of The 2020 Financial Statements

• Our review of Atlanticus' recently filed financial statements for 2020 indicates to us continued strong performance of the company and upside potential for the stock.
• While Atlanticus' 4Q20 earnings appeared to be less than our expectations due to significant non-cash charges, we observe the more predictable cash from operations to be in-line with our expectations.
• We note that Atlanticus continued to enjoy favorable delinquency trends, which it attributes in part to government stimulus programs and, as such, we expect these trends to continue.
• It appears increasingly clear to us that Atlanticus is producing at least $4 per share of earnings and $5 per share of free cash flow, as well as substantial growth.
• Remarkably, Atlanticus continues to have no sell-side coverage and so we share below our analysis of the 4Q20 financial statements with the hope of providing additional transparency for investors.

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