Jefferson Capital, Inc.

What they do

The Company buys portfolios of nonperforming consumer receivables (credit card, auto, telecom, utilities, etc.) from creditors at deep discounts and collects on them. It also provides debt servicing and portfolio management for nonperforming loans and earns credit card revenue through acquisition programs. It operates through four geographic segments: United States, United Kingdom, Canada, and Latin America, with two primary lines of business: Distressed (purchase, collection, and servicing) and Insolvency (bankruptcy-related assets).

Revenue drivers

• United States segment — Largest geographic segment; collections in Q2 2026 were $235.4 million, up 16.3% year-over-year, driven in part by the Bluestem portfolio purchase (contributed $41.0 million in collections).
• Canada segment — Collections in Q2 2026 were $35.3 million, up 14.6% year-over-year; ERC grew 20.7% to $420.5 million.
• Latin America segment — Fastest-growing segment; collections in Q2 2026 rose 52.5% to $18.0 million, and ERC grew 32.6% to $324.0 million.
• United Kingdom segment — Collections in Q2 2026 were $12.2 million, up 14.0% year-over-year; ERC grew 24.5% to $197.2 million.

Recent performance

Second quarter 2026 revenue grew 16% to a record $177.5 million. Net income was $41.3 million (EPS $0.67); adjusted net income was $47.3 million (adjusted EPS $0.77). Total collections grew 18% to $300.9 million, and deployments were up 21% to $152.2 million. ERC rose 18% to $3.4 billion. For full-year 2025, revenue was $613.3 million and net income was $188.0 million (diluted EPS $5.64). The Company completed its IPO in June 2025.

Strategy

Management focuses on analytically driven portfolio purchasing, using proprietary statistical and behavioral models to value and manage receivables. It seeks to expand through forward flow arrangements and mixed portfolio purchases (performing and nonperforming) to offer one-stop solutions to sellers. The CEO highlighted a focus on auto finance, where record balances and credit quality headwinds are driving supply growth. The Company is one of the few industry participants offering solutions across performing, charged-off, and insolvency auto finance portfolios.

Risks

• Economic and inflationary pressure — Deterioration in economic conditions or sustained inflation could reduce consumers' ability to repay, lowering collections and the value of purchased receivables.
• Reduced supply of nonperforming loans — If global credit market conditions deteriorate, fewer nonperforming loans may be available for purchase, constraining growth.
• Client concentration — Top five clients accounted for 45.2% of purchases in 2025 (top client 23.6%); loss of a major client could materially affect deployment levels.
• Leverage and financing access — The Company holds $1.75 billion in long-term debt and depends on its Revolving Credit Facility; financial instability of lenders could limit access to capital.

Outlook

Management says the investment environment remains favorable, particularly in auto finance, and expects continued portfolio supply growth. They are focused on executing their differentiated strategy to drive shareholder value in the near and long term. The Company declared a quarterly dividend of $0.24 per share, indicating confidence in cash flow generation.