Enova International Reports Robust 2024 Growth: Revenue, Originations and EPS Hit Record Levels
Enova International Inc (NYSE: ENVA) delivered impressive financial results for 2024, posting over 20% growth across multiple key metrics, including revenue, originations, adjusted EBITDA, and adjusted EPS compared to the previous year. Despite some market challenges and regulatory concerns, the company has successfully positioned itself for continued growth in the evolving lending landscape.
Record-Breaking Performance in 2024
Enova International achieved record revenue, originations, and adjusted EPS in 2024. The company reported $1.7 billion in originations during the fourth quarter, marking a 20% year-over-year increase and 6% sequential growth. This surge in originations was a key driver behind the company’s strong performance, particularly in its small business lending segment, which accounted for 62% of its total portfolio.
Strong Liquidity and Balance Sheet
Enova continues to maintain a strong financial position with $1.3 billion in liquidity, which includes $326 million in cash and marketable securities. This robust balance sheet provides the company with flexibility to navigate market fluctuations and capitalize on growth opportunities.
Moderated Origination Growth
While Enova’s fourth-quarter originations were up by 20%, the company acknowledged a moderation in growth compared to the first nine months of the year, where it experienced 25% plus growth. This moderation could be attributed to broader macroeconomic conditions and the company’s cautious approach amid potential changes in the economic landscape.
Small Business Lending Leads the Way
The company’s small business products have proven to be a major growth driver, accounting for 62% of the total portfolio. Enova remains optimistic about the demand in this segment and is well-positioned to meet the financing needs of small businesses, which have proven resilient in the current economic climate.
Marketing and Regulatory Considerations
Marketing expenses are expected to remain in the upper 10s percentage range for the first quarter of 2025, reflecting continued investment in customer acquisition. However, Enova has also expressed concerns about potential regulatory challenges, such as the small business disclosure rule and small dollar rule payment provisions, which could impact its business operations moving forward.
Competitive Landscape and Consumer Health
Enova’s CEO, David Fisher, addressed the competitive environment, noting that while there has been some fluctuation in the market, the company hasn’t faced significant negative impacts from competition. Enova’s strong originations growth in Q4 and solid start to Q1 2025 suggest that competition is not currently a major threat to its market position. Fisher also highlighted the health of Enova’s non-prime consumer portfolio, supported by a robust labor market and rising wages.
In terms of customer mix, 40% of originations came from new customers in both the consumer and small business lending portfolios, with no significant changes expected in this mix for the upcoming year.
Stock Valuation and Market Skepticism
Despite Enova’s strong performance, the company believes that its stock remains undervalued, signaling a degree of market skepticism despite its solid financial results. The company’s leadership remains focused on delivering strong growth while addressing market concerns and navigating potential regulatory hurdles.
As Enova continues to expand its lending portfolio and capitalize on strong demand in the small business sector, it will look to sustain its growth momentum through strategic investments in marketing, customer acquisition, and portfolio management. With a solid liquidity position and record-breaking performance in 2024, the company remains well-positioned for future success in the dynamic lending market.
