Encore Capital GroupFRA:ECP -3.23%64 Interest Coverage is 2.60 as of Mar. 2026, which is 36% above its 10-year median of 1.91. GuruFocus rates FRA:ECP with a GF Score™ of 64/100 and a GF Value™ of €59.84 (Modestly Overvalued). The stock has 10 warning signs investors should review. Among 164 Credit Services companies, Encore Capital Group ranks worse than 85.98% on this metric.
Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's
Operating Income
by its Interest Expense. Encore Capital Group's
Operating Income
for the
three
months ended in Mar. 2026 was €159 Mil. Encore Capital Group's Interest Expense for the
three
months ended in Mar. 2026 was €-61 Mil.
Encore Capital Group's interest coverage for the quarter that ended in Mar. 2026 was 2.60.
The higher the ratio, the stronger the company's financial strength is.
The historical rank and industry rank for Encore Capital Group's Interest Coverage or its related term are showing as below:
FRA:ECP'
s Interest Coverage Range Over the Past 10 Years
Min: 1.16 Med: 1.91 Max: 3.73
Current: 2.4
FRA:ECP's Interest Coverage is ranked worse than 85.98% of 164
companies
in the Credit Services industry
Industry Median: 49.41
vs FRA:ECP: 2.40
Encore Capital Group (FRA:ECP) Interest Coverage Explanation
Ben Graham requires that a company has a minimum interest coverage of 5 with the companies he invested. If the interest coverage is less than 2, the company is burdened by debt. Any business slow or recession may drag the company into a situation where it cannot pay the interest on its debt.
Interest Coverage is an important factor when GuruFocus ranks a company's overage Financial Strength .
Encore Capital Group Interest Coverage Related Terms
Encore Capital Group Interest Coverage Historical Data
* Premium members only.
The historical data trend for Encore Capital Group's Interest Coverage can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Note: For Interest Coverage, "No debt" indicates no long-term debt. An indication of "No Debt" does not necessarily mean that the company has no long-term debt obligations; it could be due to missing data in the quarterly or annual report. Use caution when interpreting this information.
FRA:ECP vs AGM.A, EZPW, QFIN: Interest Coverage Comparison
For the Credit Services subindustry, Encore Capital Group's Interest Coverage, along with its competitors' market caps and Interest Coverage data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Encore Capital Group Interest Coverage vs Credit Services Industry
For the Credit Services industry and Financial Services sector, Encore Capital Group's Interest Coverage distribution charts can be found below:
* The bar in red indicates where Encore Capital Group's Interest Coverage falls into.
Encore Capital Group Interest Coverage Calculation
Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Encore Capital Group (FRA:ECP) has a Interest Coverage of 2.60 as of Mar. 2026. Interest Coverage measures a company's capability to pay interest expenses on its debt. View historical data on Encore Capital Group and its competitors. This is 36% above median its historical median of 1.91. Over the past decade, Encore Capital Group's Interest Coverage has ranged from 1.16 to 3.73. According to the industry distribution chart, Encore Capital Group ranks #141 out of 164 companies in the Credit Services industry, placing it in the top 86%.
Is Encore Capital Group's Interest Coverage too high?
Encore Capital Group's current Interest Coverage of 2.60 is 36% above median its 10-year median of 1.91. Over the past 10 years, this metric has ranged from a low of 1.16 to a high of 3.73. The Credit Services industry median Interest Coverage is 49.41. Encore Capital Group's value of 2.60 is 94.7% below this industry median. Based on the distribution chart, Encore Capital Group ranks #141 out of 164 companies in the Credit Services industry, which is in the bottom quartile relative to peers. Overall, Encore Capital Group has a GF Score™ of 64/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Encore Capital Group's Interest Coverage compare to AGM.A and EZPW?
According to the Credit Services industry distribution chart, Encore Capital Group ranks #141 out of 164 companies for Interest Coverage. This places Encore Capital Group in the lower half of its industry. The industry median Interest Coverage is 49.41. Encore Capital Group's value of 2.60 is 94.7% below this benchmark. Historically, Encore Capital Group's own Interest Coverage has ranged from 1.16 to 3.73 over the past decade. While the company's 10-year median is 1.91 vs. the industry median of 49.41, Encore Capital Group has consistently been below the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Interest Coverage for a Credit Services company?
The median Interest Coverage among Credit Services companies is 49.41, based on 164 companies in the industry. Companies in the top quartile (top 25%) have a Interest Coverage significantly above this median, while those in the bottom quartile fall well below. However, Interest Coverage should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Encore Capital Group's current Interest Coverage of 2.60 is 94.7% below the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Interest Coverage mean?
A high Interest Coverage can signal that a stock is expensive relative to its fundamentals. Interest Coverage measures a company's capability to pay interest expenses on its debt. View historical data on Encore Capital Group and its competitors. For the Credit Services industry, the median Interest Coverage is 49.41 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Encore Capital Group's current Interest Coverage is 2.60, which is 36% above median its own 10-year median of 1.91. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Encore Capital Group stock overvalued right now?
Based on GuruFocus' analysis, Encore Capital Group (FRA:ECP) is currently considered Modestly Overvalued. The stock's GF Value™ is €59.84, compared to a current price of €75.00 — trading 25.3% above its estimated fair value. The current Interest Coverage is 2.60, which is 36% above median its 10-year median of 1.91 and 94.7% below the Credit Services industry median of 49.41. Encore Capital Group's overall GF Score™ is 64/100 with 10 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Interest Coverage calculated?
Interest Coverage is calculated from a company's financial statements. For Encore Capital Group (FRA:ECP), the current Interest Coverage is 2.60 as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Encore Capital Group (FRA:ECP) Overvalued in 2026?
Based on GuruFocus' analysis, Encore Capital Group stock appears to be overvalued.
The current stock price of €75.00 is trading 25.3% above its estimated GF Value™ of €59.84.
GuruFocus considers Encore Capital Group to be Modestly Overvalued.
Key valuation signals for FRA:ECP:
Interest Coverage: 2.60 (36% above median its 10-year median of 1.91)
GF Value™: €59.84 vs. price of €75.00 (25.3% above fair value)
Industry Position: 94.7% below the Credit Services median (#141 of 164)
No single metric tells the full story. See the FRA:ECP stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Encore Capital Group Inc is an international specialty finance company engaged in providing debt recovery solutions and other related services for consumers across a broad range of financial assets. It mainly purchases portfolios of defaulted consumer receivables at deep discounts to face value and manages them by working with individuals to repay their obligations and work toward financial recovery. The company also provides debt servicing and other portfolio management services to credit originators for non-performing loans in Europe. It has only one reportable segment, debt purchasing and recovery. Geographically, the company generates maximum revenue from its business in the United States, followed by the United Kingdom, Europe, and other regions.
64GF Score
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