scroll

Cash Converters International Ltd (CCV)

Advanced Search

Our Q&As are emailed in our Saturday Morning Report, find the answer to this question below.

Ask a question

The Latest Q&A

Question asked 23/01/2026

Cash Converters International Ltd (CCV)

Do you have a view on CCV? I find it an interesting 'roll-up' story with a positive twist. They have just finished a cap raise to buy out franchise stores at around 3-4X EBITDA when CCV is currently priced at about 8x EBITDA. However my understanding is that the franchise stores use the same software and thus CCV have full transparency of annual sales of each store they are acquiring so should be able to accurately determine the profit add-on for being a company owned store. So a current 6% FF yield with improving profits from more coy owned stores and hopefully an acceleration of share price if business continues to be priced at 8X EBITDA. Thoughts? Cheers David

Answer

Hi David,

CCV’s recent acquisition of 29 Australian franchise stores was at around ~4.5× FY25 EBITDA expanding its corporate store network, which the company expects to be EPS accretive in the first full year after integration. Indeed, as the franchisees use the same point-of-sale, loan management and inventory systems as corporate stores, CCV has visibility into individual store performance, easing diligence and helping ensure the accretion thesis is based on reality rather than assumptions making it safer than many acquisitions.

If the roll-up strategy delivers as expected (synergies + higher margins) the gap between transaction multiples and market multiples could continue to compress in CCV’s favour. However, we shouldn’t forget the recent $25mn equity raising at 30.5c which diluted shareholders to provide capital to fund these acquisitions.

CCV currently yields ~6% (fully franked) demonstrating strong free cash flow metrics relative to its market cap.
Note this relatively small $230mn retailer only trades small volume – 37k worth of stock traded on Friday.

It’s too small for us, but we don’t mind CCV around the 31-32c.

chart

Cash Converters International Ltd (CCV)

LAST UPDATED 22/01/2026 11:47

Latest Reports

Afternoon report 23/01/2026

The Match Out: Tech stocks finally see some love, ASX up on the day, mildly lower for the week

The ASX finished modestly higher as a rare day of strength for the IT stocks and continued support for the gold miners offset broader caution across banks and consumer shares. While the headlines have cooled through the week, geopolitical tension and rake hike expectations continue to reinforce nervous sentiment, as the market positions for what will likely be a volatile reporting season ahead – both here and in the US.

Morning report 23/01/2026

ETF Friday: Is there better value in LIC’s vs ETF’s?

The ASX 200 bounced +0.8% on Thursday, driven higher by a robust banking sector - the financials contributed 80% of the index's 66-point gain. The gold sector dominated the losers' enclosure as the precious metal lost its shine following Trump's more balanced speech from Davos, which notably stated that the US wouldn’t invade Greenland or impose tariffs on European nations in February.