Encore Capital Group (ECPG) is drawing attention after reporting second quarter 2026 earnings, updating full year profit guidance and completing another tranche of its long running share repurchase program.

Encore Capital Group’s recent earnings release, higher full year EPS guidance and completion of another buyback tranche come against a strong price backdrop, with the stock showing building momentum through a 90 day share price return of 21.71% and a 1 year total shareholder return of 155.61%.

If this kind of strong move has you thinking more broadly about opportunities, it could be a good moment to scan for other companies showing resilient balance sheets and attractive fundamentals using our solid balance sheet and fundamentals stocks screener (49 results)

After a move like this and higher guidance on the table, Encore Capital Group now has a very different risk profile than it did a year ago. Do the current valuation and buybacks still leave enough potential benefit for new buyers?

Most Popular Narrative: 16.8% Undervalued

Encore Capital Group’s latest close of $100.20 sits below a narrative fair value of $120.38, which frames the current move against a longer term valuation story.

As I have previously written, ECPG is solid and undervalued. Despite recent analyst attention and a meaningful increase in its share price, I believe it remains undervalued. My valuation starts with its ERC, or Estimated Remaining Collections, which, based on the company’s latest filings, is approximately $10 billion. On that basis alone, the runoff or liquidation value of the company appears to far exceed its current market cap of less than $2 billion. Analysts are currently providing valuation ranges of roughly $80 to $110 per share, largely based on performance and earnings outlook. In my view, that range still misses five important short- and long-term considerations.

Want to see what sits behind that $120.38 figure? The narrative leans on cash collection visibility, long term revenue expectations and profitability assumptions that may surprise you.

Result: Fair Value of $120.38 (UNDERVALUED)

However, the Encore Capital Group story could change quickly if cash collections soften, or if further write downs revive questions about management decisions.

Next Steps

With both potential risks and rewards in play for Encore Capital Group, now is a good time to look through the details yourself and decide how comfortable you feel with the balance. To see both sides set out clearly, review the 3 key rewards and 1 important warning sign

Looking for more investment ideas beyond Encore Capital Group?

If Encore Capital Group has sharpened your interest, now is the moment to widen your research using focused stock ideas that match your preferred balance of risk and reward.

• Target potential mispricings by scanning companies that combine solid fundamentals with attractive entry points through our 50 high quality undervalued stocks
• Build a steadier income stream by reviewing companies that offer robust yields in our 8 dividend fortresses
• Limit downside risk by focusing on companies with resilient finances using the 79 resilient stocks with low risk scores

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.