3 Things About goeasy Stock Every Smart Investor Knows

goeasy Ltd. (TSX:GSY) stock has posted superior growth on the back of strong earnings, and it boasts a rock-solid dividend track record.

| More on:
woman analyze data

Image source: Getty Images

The S&P/TSX Capped Financial Index rose just 0.35% on Wednesday, January 24. In this piece, I want to zero in on one of the most exciting financial stocks available on the Toronto Stock Exchange (TSX). That stock is goeasy (TSX:GSY). This Mississauga-based company provides non-prime leasing and lending services under the easyhome, easyfinancial, and LendCare brands to consumers in Canada.

Today, I want to explore three things about goeasy that every smart investor knows, or should know, in the early part of 2024. Let’s jump in.

goeasy has been one of the top growth stocks in the financials space

goeasy has been one of the most explosive growth stocks on the broader TSX, let alone the financial space. That has made it a favourite target of investors who have been on the hunt for big growth in the first half of the 2020s. Shares of goeasy have been quite static in the month-over-month period as of close on January 24. Indeed, the financial stock has moved down marginally over this trading period.

Shares of goeasy have increased 30% year over year as of close on January 24. Moreover, the stock has soared over 300% in a five-year span at the time of this writing. goeasy’s performance was especially impressive during the COVID-19 pandemic. Its stock succumbed to the early 2020 market pullback, falling below the $30 price mark in March. By April 2021, a little over a year later, goeasy stock had climbed above the $130 price point.

What is the reason for its explosive performance? Let’s glance at the company’s earnings.

The company has posted consistently strong earnings for years

Investors can expect to see goeasy’s fourth-quarter (Q4) and full year fiscal 2023 earnings in the middle of February. The company unveiled its Q3 FY2023 earnings back in November 2023. In the quarter, loan originations climbed 13% year over year to $722 million, while the company’s loan portfolio grew 33% to a whopping $3.43 billion. Meanwhile, revenue rose 23% to $322 million.

goeasy’s largest brand, easyfinancial, delivered record revenue of $284 million in Q3 — up 26% over Q3 2022. Moreover, it posted record volume of credit applications and record new customer volume of 42,700. Overall, goeasy has achieved 89 straight quarters of positive net income. It also delivered its 54th consecutive quarter of same-store revenue growth.

Looking ahead, goeasy is in a great position to take advantage of the soaring demand for non-prime leasing and lending. Canadians are living under increased financial pressure due to rising inflation and the highest interest rates in over 15 years.

goeasy is a Dividend Aristocrat

A Canadian Dividend Aristocrat is a stock that has achieved at least five straight years of dividend growth. Five years is not a guarantee of dividend stability, but it does show a solid history for investors to consider. The fact that goeasy is nearing the decade mark in terms of dividend growth speaks to its track record.

goeasy last paid out a quarterly dividend of $0.96 per share. That represents a 2.4% yield. The company has now delivered dividend increases for nine consecutive years. Shares of goeasy currently possess a price-to-earnings ratio of 13, which puts this growth stock in favourable value territory compared to its industry peers.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Ambrose O'Callaghan has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

More on Dividend Stocks

data analytics, chart and graph icons with female hands typing on laptop in background
Dividend Stocks

Down by 25%: Is Canadian Tire Stock a Buy in February 2024?

Take a closer look at this Canadian retail stock if you are looking for low-cost additions to your self-directed portfolio…

Read more »

stock research, analyze data
Dividend Stocks

Is it Too Late to Buy Dollarama Stock?

Dollarama (TSX:DOL) stock is up almost 200% from its 2020 lows. Is it still a buy?

Read more »

Golden crown on a red velvet background
Dividend Stocks

Cash Kings: The Top 2 Canadian Stocks That Pay Monthly

Two Canadian stocks are cash kings to income investors for their generous dividends and monthly payouts.

Read more »

A close up image of Canadian $20 Dollar bills
Dividend Stocks

2 No-Brainer Stocks to Buy Right Now for Less Than $20

Cheap TSX stocks such as Savaria have the potential to deliver steady gains to long-term shareholders in 2024.

Read more »

grow dividends
Dividend Stocks

TFSA Passive Income: 2 Dividend Stocks to Double Up on Right Now

These top TSX dividend stocks are on sale.

Read more »

Aircraft wing plane
Dividend Stocks

Is Bombardier Stock a Buy After Missing its Earnings Estimates?

After going past its earnings estimates, Bombardier stock looks like an excellent holding right now.

Read more »

Businessperson's Hand Putting Coin In Piggybank
Dividend Stocks

RRSP Ready: 2 Stellar Stocks for Your Annual Contribution

Two high-yield stocks are ideal options if you plan to maximize your annual RRSP contribution limits and reduce taxable income.

Read more »

grow dividends
Dividend Stocks

3 Stocks That Could Be Easy Wealth Builders

Long-term investors would be wise to have these three Canadian stocks on their radar.

Read more »