Encore Capital Group (NASDAQ: ECPG) saw its stock price soar by an impressive 16.34% in Thursday's pre-market trading session, following the release of its exceptional third-quarter 2025 financial results and subsequent analyst upgrades. The debt recovery solutions provider significantly outperformed market expectations, demonstrating robust growth across its key markets.

The company reported earnings per share of $3.17 for Q3, marking a substantial 152% increase from $1.26 in the same period last year and handily beating the analyst consensus estimate of $1.83. Encore Capital's quarterly revenue also impressed, coming in at $460.353 million, up 25.41% year-over-year and surpassing the analyst estimate of $410.694 million by 12.09%. The strong performance was driven by exceptional results in both its U.S. and European markets, with the U.S. MCM business seeing a 13% increase in portfolio purchases and a record 25% surge in collections to $502 million.

In light of these positive outcomes, Encore Capital raised its full-year 2025 collections guidance to approximately $2.55 billion and announced a $300 million share repurchase program reauthorization. The market's enthusiasm has been further bolstered by analyst upgrades, with Truist Securities raising its target price to $59 from $57, and Janney Montgomery Scott increasing its price target to $62 from $56 while maintaining a Buy rating. These factors combined have contributed to the stock's significant rally, reflecting growing investor confidence in Encore Capital's business model and future prospects.