Significant Improvement in June Data; Taking EPS Estimates Up to Inline w/ Consensus

研报英文原文证据摘录

Significant Improvement in June Data; Taking EPS Estimates Up to Inline w/ Consensus

Investment Thesis

We rate OMF Neutral. Non-prime lenders like OneMain are already underwriting for strong profitability even in recessionary

environments, and we think OneMain is poised to take share as traditional lenders cut customers out of their underwriting boxes.

Our key concern on OMF shares is the trajectory of losses through 2026, which depends on the rate of growth of new loans andSPECIALTY the credit quality of the existing portfolio written prior to August 2022. We also somewhat worry about competition from fintechs

in the personal lending sector.

Upcoming Catalysts Price Performance

■ Monthly ABS data releases, which provide an accurate snapshot of OneMain credit $75FINANCE

performance. $70

■ Front-book / back-book inflection point: expect to see a rapid improvement in

credit performance and risk-adjusted margins. $65

■ Ramp-up of OneMain's auto lending platform including its recent FourSight $60EQUITY acquisition. $55

■ Volume share grab in near-prime credit cards.

$50

Base Case Assumptions $45

Aug-25 Sep-25 Oct-25 Nov-25 Dec-25 Jan-26 Feb-26 Mar-26 Apr-26 May-26 Jun-26 Jul-26 ■ Our model is generally in line with 2026 guidance.

OMFRESEARCH ■ Loss roll-rate is the key focus. For 2026 losses, we are near the midpoint of S&P 500 (rebased)

guidance, at our 7.7% versus guidance 7.4%-7.9%. Source: FactSet

■ We model 2026E managed receivables growth at 6% vs. guidance range of 6%-9%.

■ Our expense ratio is down 10bps y/y inline with guidance at 6.6%. Company Description

OneMain is a branch-based U.S. lender

Upside Scenario focused on the non-prime consumer

■ Credit trends are the main driver for OMF's stock performance. A more rapid segment. OMF's primary consumer