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Non-Tech : Banking and Finance? How about a pawn shop? - PWN
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To: Gary Vanier who wrote (24)9/10/1997 12:20:00 AM
From: Carl R.   of 56
 
Company told me last week return on equity was 14%. Company has shareholder equity of 20mil earned 2.3 mill in net income for this year.

The numbers I quoted were for 1996. I do not have ROE numbers for 1997, so it is possible that your 14% number is correct for 1997. This may also explain the big jump in sales per employee. Perhaps they made a big boost in sales per employee, and this showed up on the bottom line as a big jump in ROE.

Thanks for your comments regarding accounting practices. I think my friends reference had something to do with how they account for goods that are to be sold, and when they are recognized as revenue. Is this the issue that you are referring to?

You seem quite familiar with these companies, much more so than I am. Can you answer some questions for me? I still would like to know why my data shows no net tangible assets for First Cash, and if they are carrying alot of intangibles on the books.

Also, which company has the most exposure to the check cashing business. Is one more of a true pawn shop than the other, or are both operations fairly similar?

Also, can you tell me the debt to equity ratio for PAWN, and the interest coverage? I am wondering if PAWN has extended itself and will have to slow down its rate of expansion. Cash Flow/share isn't that great, so this could be a concern.

Thanks. This thread gets more interesting all the time,

Carl
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