Earnings call transcript: Exchange Income tops EPS estimates in Q3 2026

Exchange Income Corporation reported Q3 2026 adjusted earnings per share of $1.81, surpassing the $1.60 expectation from analysts. Despite revenue falling slightly short of forecasts at $1.06 billion compared to the $1.07 billion prediction, the company's performance was record-breaking across metrics including revenue, EBITDA, free cash flow, and per-share results.

This strong showing set new records in revenue, EBITDA, free cash flow, and per-share earnings, and the company lifted full-year adjusted EBITDA guidance. The EPS beat came from record operating performance across several key areas, with revenue reaching CAD 1 billion for the first time in a single quarter. Management raised the Q2 2026 adjusted EBITDA guidance to CAD 890 million to CAD 920 million, and introduced a new Q2 2027 range of CAD 1.0 billion to CAD 1.06 billion, marking the first time the company has set such an outlook.

Leverage improved to 2.64 times EBITDA, while liquidity remained strong at over CAD 2 billion. The Q3 results were highlighted as the strongest in the company's history across multiple measures. Revenue did slightly miss expectations by 0.93%, with $1.06 billion in sales versus the $1.07 billion forecast. However, the EPS beat, record results, and higher guidance largely outweighed this minor shortfall.

Management noted that the combination of strong operating efficiency and capital discipline proved more impactful than the minor revenue miss. The stock was last traded at $126.63, up 1.05% from the previous close of $125.31, staying near the upper range of its 52-week trading window of $75.27 to $136.75. InvestingPro analysis suggests the stock is undervalued, with the company offering consistent shareholder returns through a 23-year streak of dividend payments and four consecutive years of dividend increases.