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  5. GSY: Just read your special report on small caps specifically Go Easy where you cite a growth rate of 17% mainly organically . [goeasy Ltd.]
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Q: Just read your special report on small caps specifically Go Easy where you cite a growth rate of 17% mainly organically . Could you explain how this growth is accomplished ? To my albeit simple mind the sub prime lending market is something I wouldn't expect to expand unless economic times became perilous as well ..... A brief explanation of how this growth is accomplished across the three sectors of its' business model would be appreciated ? .....
Also between GSY and PRL at current stock prices which do you favour today ? .......Thankyou for your always sound council .....
Asked by Garth on April 26, 2024
5i Research Answer:

GSY obtains its organic growth rates through reinvesting its earnings back into its existing operations. The company also creates new products and services within its main lines of business and optimizes sales through marketing and sales strategies.  

The subprime lending market has been performing well given the current high interest rate environment. Banks have tightened their lending standards due to higher rates, and this has pushed out more individuals that would traditionally be offered a loan by a bank to these subprime lenders. 

GSY is roughly four times the size of PRL, and has a longer history of being publicly traded. Its operations are a little bit more mature and robust, but for a high-growth strategy, we would prefer PRL. Overall, PRL is slightly cheaper and has stronger growth rates, and it also has a higher exposure to the US. For a more conservative approach, we like GSY, for a higher-risk approach, we like PRL.