FirstCash Holdings, Inc. (FCFS): what the price requires
At today's price, FirstCash Holdings, Inc. (FCFS) is priced for +11.5% growth. boothcheck doesn't publish a fair value or a price target; it shows what the price assumes, so you can judge whether that bar is too high.
Generated: 2026-07-14 · Exported: 2026-07-16 · Source: https://boothcheck.com/report/FCFS
Headline
| Field | Value |
|---|---|
| Ticker | FCFS |
| Company | FirstCash Holdings, Inc. |
| Current price | $214.61/sh |
| Composition | U.S. Pawn 63% / U.K. Pawn 5% / Retail POS Payment Solutions (AFF) 31% |
What The Price Requires (Inversion)
The assumption today's price embeds, recovered by inverting the valuation.
| Field | Value |
|---|---|
| Inversion basis | whole-company |
| Operating margin needed | 3.6% |
| Operating margin today | 12.3% |
| Margin compression implied | -8.7pp |
| Implied growth | 11.5% |
| Multiple paid | 26x operating income |
The operating-margin requirement is derived from the framework's value band at year 12, a separately labeled basis from the headline growth/duration solve.
Solve inputs: computed at a 7.5% cost of capital with 4% terminal growth over a 5-year stage; each 1pp of cost of capital moves the implied operating-profit growth ~8.4pp.
Reconcile: at the x-ray's 9.3% required return this reads ~5.1 years; the models below use their own rates.
How unusual the bet is: within-range
| Reference | Value |
|---|---|
| vs own history | +0.54σ |
| cohort percentile (of 210 peers) | 75 |
| sustained it ~5 years at this level | 51% |
| implied end-window share | 0% |
Valuation X-Ray
The price is justified by relative-multiple and growth-DCF; asset-based/earnings-power land below the price.
How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.
| Family | Median price/FV | Models | Reads |
|---|---|---|---|
| Asset | 2.08x | 4 | expensive |
| Earnings | 2.36x | 4 | expensive |
| Relative | 1.08x | 4 | expensive |
| Growth | 0.76x | 2 | justifies |
Families that justify the price: Relative, Growth Families that call it expensive: Asset, Earnings
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 8.1%); the inversion above states its own rate.
Per-Model Detail (n=14)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | $432.77 | 0.50x | yes | FCF base $0.7B, growth 14% (input: historical growth), terminal g 4.0%, WACC 8.1%, 6yr projection |
| DCF Exit Multiple | Growth | $0.00 | — | no | Negative/zero FCF or EBITDA — equity value floored at $0 |
| Relative Valuation | Relative | $183.20 | 1.17x | yes | P/E 20x (static sector reference · 2026-04), scenarios: 16.4x / 20.0x / 23.6x (bear / base = reference held flat / bull), EV/EBITDA 14x |
| Simple DDM | Growth | — | — | no | — |
| Two-Stage DDM | Growth | — | — | no | — |
| Simple Excess Return | Asset | $86.61 | 2.48x | yes | BV/sh $51.94, ROE (TTM) 15.4%, ke 9.3% |
| Two-Stage Excess Return | Asset | $110.47 | 1.94x | yes | 5yr excess ROE then converge to ke=9.3% |
| Discounted Future Market Cap | Growth | $208.35 | 1.03x | yes | Rev $3.9B, growth 14% (input: historical growth; tapered), Terminal P/S: 2.0x / 2.4x / 2.9x (bear / base = today's held flat / bull, cap 12x) |
| Peter Lynch Fair Value | Relative | $218.52 | 0.98x | yes | EPS $7.98, growth 27% (input: historical EPS growth), PEG=0.98 (Undervalued) |
| Margin Trajectory | Growth | — | — | no | — |
| Earnings Power Value | Earnings | — | — | no | — |
| Residual Income | Asset | $112.92 | 1.90x | yes | BV $51.94 + 5yr PV of (ROE (TTM) 15.4% − Kₑ 9.3%) × BV; BV grows 8.8%/yr |
| Graham Number | Asset | $96.57 | 2.22x | yes | √(22.5 × EPS $7.98 × BVPS $51.94) — Graham's conservative floor |
| EV/EBITDA Relative | Relative | — | — | no | — |
| FCF Yield | Earnings | $93.70 | 2.29x | yes | FCF $612.9M / Kₑ 9.3% — zero-growth perpetuity |
| SBC-Adj FCF Yield | Earnings | $88.53 | 2.42x | yes | SBC-adj FCF $0.59B (FCF $0.61B − SBC $0.02B) capitalized at Kₑ |
| Ben Graham Formula | Earnings | $257.49 | 0.83x | yes | EPS $7.98 × (8.5 + 2×15.0%) × (4.4 / 5.3%) |
| ROIC-Justified P/B | Asset | — | — | no | — |
| P/Sales Sector | Relative | $131.40 | 1.63x | yes | Revenue $3.88B × sector P/S 1.5x |
| PEG Fair Value | Relative | $299.25 | 0.72x | yes | EPS $7.98 × (PEG 1.5 × growth 25.0% (input: historical EPS growth)) → PE 37.5x |
| Earnings Yield | Earnings | $86.27 | 2.49x | yes | EPS $7.98 / required return 9.3% (Rf 4.3% + ERP 5.0%) |
| Funds From Operations Multiple | Relative | — | — | no | — |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Solvency
| Field | Value |
|---|---|
| Net debt | $2.1b |
| Net debt / NOPAT (after-tax) | 6.36x |
| Net debt / operating income (pre-tax) | 4.72x |
| Share count CAGR (buyback) | -2.2% |
| Burning cash | no |
Interest expense is not separately reported in the latest filings, so interest coverage cannot be computed.
Bullet Takeaways
- FirstCash runs a countercyclical, collateral-backed pawn business whose merchandise is acquired primarily through forfeited pawn loan collateral, posting record Q1 2026 revenue above $1 billion and EPS up 30% to $2.43.
- The defining risk is American First Finance, the lease-to-own arm that carries the company's regulatory exposure and credit-loss risk, a segment the filing flags for advertising, collection-practice, and underwriting scrutiny.
- At about 26 times operating income the price assumes near-12% operating growth holds for five years, so watch same-store pawn receivables (up 19% in the U.S. last quarter) and AFF loss rates as the swing factors.
Bull Case
The standard worry about FirstCash is that a lender to lower-income customers is a fragile business, exposed to credit losses and regulators. Look at how the pawn engine actually works and the worry inverts. A pawn loan is collateralized by an object the customer hands over, and if the loan is not repaid the company simply keeps and resells it. The 10-K describes the merchandise feeding its retail shelves as acquired primarily through forfeited pawn loan collateral. There is no underwriting decision to get wrong and no unsecured balance to chase. The product is a short-term loan against a watch or a power tool, and the downside is a resale, not a write-off.
That structure is countercyclical, which is rare and valuable. When household budgets tighten, demand for small secured loans rises, and the same downturn that hurts most lenders sends more customers through the pawnshop door. The first quarter of 2026 showed the engine running hot: consolidated revenue topped $1 billion for the quarter, up 26% year over year, with GAAP diluted EPS up 30% to $2.43. Same-store pawn receivables, the best forward indicator the business has, rose 19% in the U.S., 30% in Latin America, and 29% in the U.K. on a local-currency basis. Pawn receivables reached a record $851 million.
The strength was convincing enough that management raised its outlook, lifting expected U.S. pawn-fee growth to the mid-teens from prior low-double-digit guidance. The capital story reinforces it: the board declared a $0.42 quarterly dividend, and the share count has been falling about 2% a year, so the record earnings land on a shrinking base. The U.S. and Latin American pawn segments together generate roughly 80% of segment earnings, which means the cash-generative, collateral-backed core, not the financing arm, is doing most of the work.
Bear Case
The bear case is not about the pawnshops; it is about the part of the company the price increasingly leans on for growth. American First Finance, the virtual lease-to-own and retail-finance arm bought in 2021, is the segment carrying the regulatory tail, and it is exactly the kind of consumer-finance business that draws scrutiny. The 10-K is candid that AFF faces risk across its disclosures, advertising, and collection practices, and that adverse regulatory or legislative action at the state level could hit operations. The company has already settled CFPB litigation tied to the Military Lending Act, a reminder that the financing leg lives inside a regulatory regime that can change the economics with a rule.
AFF is also where the credit risk lives, the kind the pawn business structurally avoids. Unlike a collateralized pawn loan, AFF's lease-to-own and finance receivables depend on a proprietary decisioning platform, and the filing warns there is no guarantee that platform stays effective at making the underwriting calls it relies on. If AFF's loss rates run meaningfully above its provisioning, the segment that has been the growth story turns into a drag. A lender to underserved customers in a softening economy faces exactly that pressure, and the filing flags that a downturn lowers demand for AFF's products even as it raises losses on the book already extended.
The valuation leaves modest room for a stumble in either leg. At roughly $209 the price pays about 26 times company-wide operating income, which embeds operating growth near 12% a year sustained for five years. The rate is within what FirstCash has recently delivered; the stretch is the duration, and only about half of comparable fast-growers have held that pace even five years. The asset-value and earnings-power lenses both read the price as expensive against what the company earns today; only the relative-multiple and growth lenses reach it. Net debt sits near $2.1 billion, about 4.7 times pre-tax operating income, so the balance sheet carries leverage that an AFF credit shock or a regulatory hit to fee income would make heavier, not lighter.
Valuation
Today's price near $209 is paying about 26 times company-wide operating income, and read backward that price assumes FirstCash compounds operating profit at roughly 12% a year for five years. The honest read of that assumption is that the rate is not the hard part. FirstCash has recently grown at that pace; the demanding piece is the duration, the requirement that a near-12% rate persist for half a decade, which only about half of comparable fast-growers have managed.
The methods we use to triangulate split cleanly. The relative-multiple lens and the forward-growth lens both reach today's price, with a blended earnings multiple around 20 times in line with the sector. The asset-value and earnings-power lenses sit well below the price, because they credit the capital and the trailing profit the business shows today rather than the growth the price is paying for. That spread is the premium in one picture: pay 26 times operating income and you are underwriting the continuation of the same double-digit compounding that the record first quarter just demonstrated, not a re-rating from a depressed base. A Peter Lynch read, which weighs earnings growth against the multiple, lands the price as roughly fair given the growth rate the company has posted.
The balance sheet is the bound on the downside, and it is a real one. Net debt of about $2.1 billion runs near 4.7 times pre-tax operating income, leverage that is manageable while the pawn engine throws off cash but that amplifies any shortfall in the financing arm. The share count has been falling about 2% a year and the company pays a $0.42 quarterly dividend, so capital return continues alongside the leverage. The single most decisive variable for the valuation is the durability of the growth the price has already paid for: the pawn core is countercyclical and collateral-backed, but the multiple assumes both legs keep compounding, and the financing leg is the one that can break the pattern.
Catalysts
The first-quarter 2026 print was the catalyst, and it was a strong one. Consolidated revenue topped $1 billion, up 26% year over year, GAAP EPS rose 30% to $2.43, and same-store pawn receivables jumped 19% in the U.S., 30% in Latin America, and 29% in the U.K. on a local-currency basis, with total pawn receivables hitting a record $851 million. Shares rose on the report and the upgraded outlook. Management raised expected U.S. pawn-fee growth to the mid-teens from low double digits and lifted retail merchandise sales growth guidance to at least 10%. The board declared a $0.42 per-share quarterly dividend payable in May 2026.
The forward watch items are the two legs of the model. On the pawn side, the same-store receivable growth is the leading indicator for the next several quarters of fee revenue, and its strength across all three geographies is the bull's best evidence. On the financing side, the question is AFF's credit performance and regulatory standing: the segment operates inside an extensive consumer-protection regime, and the company has prior CFPB litigation experience. Loss rates running ahead of provisions, or a new state or federal rule on lease-to-own disclosures, would be the developments that most directly change the fundamental story.
Peer Cohorts (Per Segment, With Filing Citations)
U.S. Pawn / Latin America Pawn / U.K. Pawn (reported)
- EZPW (EZCORP, INC.)
- (no filing in the citation store)
- OMF (ONEMAIN HOLDINGS, INC.)
- (no filing in the citation store)
- ENVA (Enova International, Inc.)
- (no filing in the citation store)
- CACC (CREDIT ACCEPTANCE CORP)
- (no filing in the citation store)
Retail POS Payment Solutions (AFF) (reported)
- EZPW (EZCORP, INC.)
- (no filing in the citation store)
- OMF (ONEMAIN HOLDINGS, INC.)
- (no filing in the citation store)
- ENVA (Enova International, Inc.)
- (no filing in the citation store)
- CACC (CREDIT ACCEPTANCE CORP)
- (no filing in the citation store)
- SLM (SLM Corp)
- (no filing in the citation store)
Methodology Note
- Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
- Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
- Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
- Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.
Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.
Sources
FirstCash FY2025 10-K; FirstCash Q1 2026 earnings release · FirstCash FY2025 10-K · FirstCash Q1 2026 earnings release · FirstCash CFPB settlement announcement