Enova (ENVA)

Financial technology company Enova International (NYSE:ENVA) met Wall Street’s revenue expectations in Q3 CY2025, with sales up 16.3% year on year to $802.7 million. Its non-GAAP profit of $3.36 per share was 10.8% above analysts’ consensus estimates.

Company Overview

Pioneering online lending since 2004 with a massive database of over 65 terabytes of customer behavior data, Enova International (NYSE:ENVA) provides online financial services including installment loans and lines of credit to non-prime consumers and small businesses in the United States and Brazil.

Personal loan providers offer unsecured credit for various consumer needs. The sector benefits from digital application processes, increasing consumer comfort with online financial services, and opportunities in underserved credit segments. Headwinds include credit risk management in unsecured lending, regulatory oversight of lending practices, and intense competition affecting margins from both traditional and fintech lenders.

Enova's competitors include traditional storefront lenders like Ace Cash Express, Check Into Cash, and One Main Financial in the consumer lending space. In the small business financing market, Enova competes with traditional banks, financial technology companies like Square Capital (Block, Inc.), PayPal Working Capital (PayPal Holdings, Inc.), and Kabbage (American Express).

A company’s long-term sales performance is one signal of its overall quality. Any business can put up a good quarter or two, but many enduring ones grow for years. Thankfully, Enova’s 21.2% annualized revenue growth over the last five years was excellent. Its growth surpassed the average financials company and shows its offerings resonate with customers, a great starting point for our analysis.

Long-term growth is the most important, but within financials, a half-decade historical view may miss recent interest rate changes and market returns. Enova’s annualized revenue growth of 22.7% over the last two years is above its five-year trend, suggesting its demand was strong and recently accelerated. Note: Quarters not shown were determined to be outliers, impacted by outsized investment gains/losses that are not indicative of the recurring fundamentals of the business.

This quarter, Enova’s year-on-year revenue growth was 16.3%, and its $802.7 million of revenue was in line with Wall Street’s estimates.

Revenue growth is one major determinant of business quality, and the efficiency of operations is another. For Personal Loan companies, we look at pre-tax profit rather than the operating margin that defines sectors such as consumer, tech, and industrials.

The pre-tax profit margin includes interest because it's central to how financial institutions generate revenue and manage costs. Tax considerations are excluded since they represent government policy rather than operational performance, giving investors a clearer view of business fundamentals.

Over the last four years, Enova’s pre-tax profit margin has risen by 35.6 percentage points, going from 48.1% to 12.5%. Expenses have stabilized more recently as the company’s pre-tax profit margin was flat on a two-year basis.

In Q3, Enova’s pre-tax profit margin was 13.7%. This result was 5.7 percentage points better than the same quarter last year.

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

Enova’s EPS grew at a solid 15.9% compounded annual growth rate over the last five years. However, this performance was lower than its 21.2% annualized revenue growth, telling us the company became less profitable on a per-share basis as it expanded due to factors such as interest expenses and taxes.

Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.

For Enova, its two-year annual EPS growth of 34.1% was higher than its five-year trend. We love it when earnings growth accelerates, especially when it accelerates off an already high base.

In Q3, Enova reported adjusted EPS of $3.36, up from $2.45 in the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street expects Enova’s full-year EPS of $12.18 to grow 11.1%.

Financial firms profit by providing a wide range of services, making them fundamentally balance sheet-driven enterprises with multiple intermediation roles. Market participants emphasize balance sheet quality and sustained book value growth when evaluating these multifaceted institutions.

This is why we consider book value per share (BVPS) an important metric for the sector. BVPS represents the real net worth per share across all business segments, providing a clear measure of shareholder equity regardless of the complexity of operations. Traditional metrics like EPS are helpful but face distortion from the complexity of diversified operations, M&A activity, and various accounting rules that can obscure true performance across multiple business lines.

Enova’s BVPS grew at an incredible 22% annual clip over the last five years. BVPS growth has recently decelerated to 11.2% annual growth over the last two years (from $41.69 to $51.59 per share).

Return on equity (ROE) measures how effectively banks generate profit from each dollar of shareholder equity - a critical funding source. High-ROE institutions typically compound shareholder wealth faster over time through retained earnings, share repurchases, and dividend payments.

Over the last five years, Enova has averaged an ROE of 24.9%, exceptional for a company operating in a sector where the average shakes out around 10% and those putting up 25%+ are greatly admired. This shows Enova has a strong competitive moat.

The debt-to-equity ratio is a widely used measure to assess a company's balance sheet health. A higher ratio means that a business aggressively financed its growth with debt. This can result in higher earnings (if the borrowed funds are invested profitably) but also increases risk.

If debt levels are too high, there could be difficulties in meeting obligations, especially during economic downturns or periods of rising interest rates if the debt has variable-rate payments.

Enova currently has $4.14 billion of debt and $1.28 billion of shareholder's equity on its balance sheet, and over the past four quarters, has averaged a debt-to-equity ratio of 3.1×. We think this is safe and raises no red flags. In general, we’re comfortable with any ratio below 3.5× for a financials business.

It was good to see Enova beat analysts’ EPS expectations this quarter despite in line revenue. Pre-tax profit also grew nicely year on year. Overall, this print had some key positives. The stock remained flat at $113.60 immediately after reporting.

Updated: December 4, 2025 at 11:17 PM EST

A common mistake we notice when investors are deciding whether to buy a stock or not is that they simply look at the latest earnings results. Business quality and valuation matter more, so we urge you to understand these dynamics as well.

There are numerous reasons why we think Enova is one of the best financials companies out there. For starters, its revenue growth was impressive over the last five years. And while its declining pre-tax profit margin shows the business has become less efficient, its BVPS growth was exceptional over the last five years. On top of that, Enova’s stellar ROE suggests it has been a well-run company historically.

Enova’s P/E ratio based on the next 12 months is 9.6x. Analyzing the financials landscape today, Enova’s positive attributes shine bright. We think it’s one of the best businesses in our coverage and love the stock at this bargain price.

Wall Street analysts have a consensus one-year price target of $140.63 on the company (compared to the current share price of $136.16), implying they see 3.3% upside in buying Enova in the short term.