CCP
Team invest recommend - aug 2026
https://www.marketindex.com.au/asx/ccp
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Credit Corp Group Limited (ASX:CCP) is an Australian financial services company based in Sydney. It is the country's largest debt buyer and collector. The company buys past-due consumer and small business debts from banks, utility companies, and phone providers, and then works with people to set up affordable payment plans. [1, 2, 3, 4]
Has a big database of consumer behavior (esp default behavior)... it can price its debt legers well
Main Business Areas
- Debt Buying: Purchases overdue debt portfolios from major lenders in Australia, New Zealand, and the United States.
- Debt Collection: Collects money on those unpaid debts or handles collection services for other clients.
- Consumer Lending: Offers short-term loans and car finance products for people who may have poor credit histories and cannot use standard banks, operating brands like Wallet Wizard and CarStart
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Over the last five years (FY2021 to FY2026), Credit Corp Group Limited (ASX: CCP) experienced a mid-period earnings dip due to lending adjustments and provisioning, but fully rebounded by FY2026 to post a record Net Profit After Tax (NPAT) of $105.5 million and revenue of $586 million. [1, 2]
Profit & Revenue Trends
- Revenue Growth: Grew steadily from approximately $418 million in FY2023 and $546 million in FY2025 to a high of $586 million in FY2026.
Debt & Gearing
- Long-term Debt: Rose from roughly $335 million in FY2023 to around $419 million by FY2025, supporting ongoing purchased debt ledger (PDL) investments. [1]
Return on Equity (ROE)
- Volatility: Peaked at roughly 14.3% in FY2022.
- Trough: Slipped to a 5-year low of 3.5%–6.2% during the FY2024 earnings slump.
- Recovery: Recovered to 10.6% in FY2025 and bounced back further to approximately 13% in FY2026 driven by strong US debt-buying performance
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The Price-to-Earnings (P/E) ratio for Credit Corp Group Limited (ASX: CCP) over the last 10 years has a long-term historical mean of 20.26 and a 10-year median of 17.26, trading between a minimum of 6.96 and a maximum of 132.35 over the broader decade-long cycle. [1, 2]
The company's P/E ratio compressed significantly due to asset impairment adjustments, changing debt-ledger dynamics in the US, and a cycle of lower core earnings, which left the stock trading historically cheap. [1]
📊 Historical P/E Ratio Data (Year-End Estimates)
The following table outlines the approximate trailing P/E ratios for Credit Corp (ASX: CCP) at the close of each recent financial year:
| Calendar/Financial Year | Approximate P/E Ratio | Valuation Context / Market Trend |
|---|---|---|
| 2026 (Current) | 8.6x | Depressed valuation following a 12% rebound in NPAT. |
| 2025 | 10.5x | Deep valuation discount from ledger impairment impacts. |
| 2024 | 20.2x | High variance following a cyclical peak and subsequent correction. |
| 2023 | 14.3x | Traded closer to historically normalized levels. |
| 2022 | 12.5x | Correction phase post-COVID consumer metrics shock. |
| 2021 | 22.7x | Spike driven by strong government stimulus supporting consumer repayments. |
| 2020 | 13.7x | Broad pandemic market sell-off low. |
| 2019 | 14.8x | Normalized growth valuation in line with long-term trends. |
| 2018 | 20.1x | Premium pricing reflecting multi-year ledger growth. |
| 2017 | 18.5x | Expansion of the company's US operations. |
| 2016 | 15.2x | Stable operating environment with standard credit deployment. |
🔍 Strategic Investment Overview & Risk Framework
Before assessing ASX: CCP as a value play based on its low P/E, implement the following evaluation checklist:
- Debt Ledger Cycles: Debt collectors like Credit Corp rely on buying delinquent ledgers from banks. If macroeconomic conditions lower banks' charge-off rates, supply drops, increasing ledger costs and depressing future earnings. [1, 2, 3]
- US Geographic Risk: A significant driver of CCP's historical valuation volatility has been its operational expansion into the highly competitive US market. Ensure you contrast Australian division performance with US returns to verify where margin degradation occurs. [1, 2]
- Capital At Risk Statement: Concentrating capital in deep value or structurally challenged sectors carries a high risk of "value traps." Always ensure single-asset exposure is constrained to a minority percentage of a broadly diversified portfolio to prevent total capital destruction.
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Over the last 10 years, Credit Corp Group (ASX:CCP) has experienced a narrowing and recent negative spread between its Return on Invested Capital (ROIC) and Weighted Average Cost of Capital (WACC), with current trailing metrics showing an ROIC of approximately 6.90% to 9.66% against a WACC of roughly 13.06%, indicating that recent returns have fallen below its cost of capital. [1, 2]
10-Year Trend Context
- Historical Performance (First Half of the Decade): For most of the past decade, Credit Corp maintained a strong core business model in debt ledger purchasing, generating historical ROIC levels that comfortably exceeded or met its cost of capital, allowing the firm to compound economic value. []
- Recent Compression (Second Half of the Decade): Headwinds in consumer lending, lower operational cash flow margins, and higher blended financing costs pushed WACC higher (hovering near a 10-year median of 13.00%–13.06%). [1, 2]
- Current Spread Dynamics: With ROIC lagging in the 7%–9% range and WACC around 13%, the negative spread signifies that the company has recently been in a value-destroying phase on an incremental capital-returns basis, working through normalization in its US and ANZ ledger buying segments
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