Pawn Shop Stocks: Learn About The Largest Pawn Shop Companies

Today, there are two pawn shop stocks listed in the United States: First Cash Holdings (Nasdaq: FCFS) and EZCorp (Nasdaq: EZPW). FirstCash is larger with a market capitalization of $4.2 billion and 2,800 stores in the United States and Latin America. EZCorp is the next largest pawn shop stock with a market capitalization of $600 million and over 1,150 stores in the United States and Latin America.

The pawn shop industry is fragmented - according to the US Census, approximately 88% of the 9,000 to 10,000 pawn shops in the United States have 10 or fewer employees. FirstCash and EZCorp represent most of the consolidation in the industry. You can view all pawn shops by using our interactive pawn shop map.

Number of pawn shops in the United States

FirstCash

FirstCash is the largest pawn shop company in the United States - as of December 2022, FirstCash operated over 1,000 locations across 25 states. FirstCash opened its first store located in Haltom City, TX in 1988. Since then, FirstCash has grown to 2,839 stores in the United States and Latin America. Over the last five years, FirstCash has opened or acquired over 1,050 stores, which represents over 50% growth.

FirstCash went through three phases to get to where it is today.

• 1988-2016 as First Cash: The Company operated as First Cash and expanded its footprint. It was the first US pawn company to expand to the high-growth Latin American market.

  

• 2016-2021 as Cash America: First Cash and Cash America merged to create the largest operator of retail pawn stores in the United States and Latin America. The merger added over 800 locations.

  

• 2021-today as FirstCash: The Company changed its name back to FirstCash and acquired American First Finance to enter the growing Point-of-Sale payments market.

  

First Cash operates pawn stores under the following brands:

• First Cash Pawn
• King Pawn
• David’s Pawn Shop
• Money Man Pawn
• Valu Plus Pawn
• Loftis Jewelry & Pawnbrokers
• Fast Cash Pawn & Gold Center
• Dan’s Discount Jewelry & Pawn
• Piazza Jewelry & Pawn
• Atomic Pawn

EZCorp

EZCorp is the second largest pawn shop operator in the United States. As of December 2022, it operated 1,175 pawn shops in five countries. The Company was founded in 1989. In 2007 it expanded to Mexico, and in 2009 it opened stores in Canada. The Company has a dual share structure, and Executive Chairman Phillip E. Cohen owns 100% of the Class B stock. EZCorp owns a 33% interest in Cash Converters International.

First Cash operates pawn stores under the following brands:

• EZPAWN
• Value Pawn & Jewelry
• USA Pawn & Jewelry
• Cash Converters
• Cash Pawn
• Easypawn
• Easy Cash Pawn
• EZ Jewelry & Loan
• Jerry’s Pawn Shop
• Max It Pawn
• EZ Cash Metro Pawn
• Pawn Plus
• Premier Pawn & Jewelry

Pawn Shop Business Model

Pawn shops provide small secured pawn loans to unbanked and underbanked consumers with limited or no access to traditional credit products. The combination of lending and retail helps diversify the revenue stream. Pawn shop loan demand is resilient, with very low credit risk given the nature of collateralized loans.

Pawn Industry Is Counter-Cyclical

Counter-cyclical businesses outperform the broader economy during recessions. As seen below, the stock price for EZCorp went up considerably during the Great Recession of 2008/09 when most stocks went down.

The chart below by the St Louis Federal Reserve shows loan delinquencies over the last 40 years (recessions are highlighted in gray). As you can see, loan delinquencies rise during recessions. This means that consumers are stretched thin and require extra cash for everyday payments. During these times demand for loans such as pawn shop loans increases.

FirstCash’s historical profitability shows profit growth during the 2008/2009 economic recession. In fact, FirstCash’s gross profit per store increased by ~50% between 2007 and 2012.

Lending & Retail Segments Diversify Earnings

Pawn stores typically have two main streams of profits: loans and retail. Pawn fees and interest typically represent the bulk of net profit.

Conclusion

The pawn industry is well positioned over the long term. FirstCash and EZCorp have grown over the last several decades through organic expansion and acquisitions. Also, the pawn industry performs well during economic recessions. Please note that this post is not a recommendation to buy or sell securities. Consult a financial advisor before making any investment decisions.