FCFS - FirstCash On A Recovery Trajectory With Attractive Long-Term Opportunities

• FirstCash's second quarter earnings beat on the revenue, operating income, and net income lines, albeit with a wider-than average estimate spread, with strong retail results and improving loan demand.
• U.S. pawn loan demand is normalizing, but the change in child tax credits could once again create pressure on loan demand. Operations in Latin America are likewise normalizing.
• FirstCash may have more growth opportunities in the U.S. as smaller operators look to exit, but expansion in Latin America remains far and away the major growth driver.
• Long-term core revenue growth of 6% and modest incremental FCF margin leverage can drive a roughly 10% long-term annualized expected return, but elevated uncertainties remain.

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