PROG Stumbles on Q4 Results

PROG Holdings, Inc. (NYSE:PRG) took a pasting Wednesday, after it announced financial results for the fourth quarter ended December 31, 2024."We finished 2024 with an excellent fourth quarter, delivering a third consecutive quarter of strong GMV growth and approximating the high end of our outlook ranges for both our revenues and earnings for the period," said PROG Holdings CEO Steve Michaels. "2024 was a successful year, driven by better-than-expected GMV growth, disciplined portfolio management, cost efficiencies, and continued execution on multiple strategic fronts. Our teams' execution across sales, marketing, and technology initiatives, combined with tighter credit conditions in the market, played a key role in driving a meaningful increase in new and repeat customers."Consolidated net earnings for the quarter were $57.5 million, compared with $18.6 million in the prior year period. The effective income tax rate was (37.5)% in the fourth quarter. The effective income tax rate was negative due to a $27.6 million deferred tax benefit related to an election which resulted in the deemed liquidation of a wholly-owned partnership for tax purposes. Adjusted EBITDA for the quarter was $65.7 million, or 10.5% of revenues, compared with $61.0 million, or 10.6% of revenues for the same period in 2023.Diluted earnings per share for the fourth quarter of 2024 were $1.34, compared with $0.41 in the year ago period. PROG shares waned $7.55, or 17.7%, to $35.14.