FirstCash upgraded to Overweight, named a 2023 Best Idea at Stephens

As previously reported, Stephens analyst Vincent Caintic upgraded FirstCash to Overweight from Equal Weight with a price target of $120, up from $105, and named the stock as his 2023 Best Idea. The risk of FirstCash’s Lease To Own business kept him on the sidelines in 2022, but even if he assumes a worst-case scenario and writes down the $399M leases and loans to zero, he comes up with a valuation of $84-$88/share, or "effectively no downside after wiping out LTO," Caintic tells investors. This downside scenario is small compared to the significant positives lifting the pawn business, which he views as "ripe for rapid growth and expanding margins," the analyst added.