A stock to buy as Canadian debt soars

Rising global debt could prove to be one of the biggest economic challenges of the 2020s. Global debt is set to hit a record high of over $ 257 trillion in the months to come after. have grown by $ 9 trillion in the first three quarters of 2019.

Individual domestic debt is also a major concern. MNP’s recent Consumer Debt Index showed that 50% of Canadian respondents said they were under $ 200 of not being able to cover their monthly bills. Almost half of those polled said they were not confident in their ability to cover their expenses without taking on more debt.

One of the reasons Goeasy (TSX: GSY) has thrived is that Canadian consumers are looking for alternatives in this difficult climate.

Goeasy offers rental of home furnishings, household appliances and electronics, as well as unsecured installment loans. In the third quarter, the company announced that its loan portfolio grew 38% year-over-year to $ 1.04 billion.

Investors can expect to see the company’s fourth quarter and full year 2019 results by mid-February. Goeasy predicts revenue growth of between 14% and 16% for fiscal 2020, and it expects its gross loan portfolio to reach between $ 1.3 billion and $ 1.4 billion by the end of next year. .

Goeasy stock is near a 52-week high, but still has a favorable price-to-earnings ratio of 15 and book value of 5. Stocks were up 84% year-on-year at the Jan. 28 close. The stock last paid a quarterly dividend of $ 0.31 per share, representing a modest return of 1.7%.

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