auto lender, have plummeted as a result of the company's sharp increase in delinquencies. According to First Call Corp., the 1995 consensus estimate among the Wall Street analysts who follow Eagle has fallen 15.5% to $1.04 per share, with the company expected to undertake aggressive reserve building in the fourth quarter. The share price of Eagle, based in Libertyville, Ill., has also plunged. From a 52-week high of $24.75, the stock has slumped 35%. Tuesday afternoon it traded at $16.25, up 50 cents. "Basically, their loan chargeoffs have been running higher than their reserve rate," said Robert C. Damron, an analyst at McDonald & Co., Cleveland. Mr. Damron recently cut his investment rating on the stock to "neutral" from "long-term buy," his second downgrade in two months. He rated the stock an "aggressive buy" from January through September. He reduced his 1995 estimate to $1.05 from $1.30 previously, on the likelihood of a fourth-quarter charge against earnings. "The company has essentially grown too fast," he said. "They've put too many loans on the books too quickly, and the staffing and training of their collections department hasn't kept pace with the volume. "They are taking a number of steps to correct these problems, including slowing down loan growth and getting their collections efforts in higher gear," he said. "But I don't feel I could recommend this stock until a better trend is apparent." Eagle, whose shares were initially offered to the public in June 1994, does business in 18 states. It is not related to Eagle Financial Corp. a thrift holding company in Bristol, Conn. Another analyst, Jackson Spears of Chicago Corp., retains a "buy" rating on Eagle's stock, but has lowered his 1995 estimate to $1.02 from $1.32 and reduced his 12-month price target on the stock to $21 from $27. "They clearly have some significant work to do, building their infrastructure," he said. "But long term, the automobile finance business is a good place (for investors) to be, and Eagle is a player in this business." Mr. Spears has a 1996 earnings estimate of $1.65 per share for Eagle, while Mr. Damron forecasts $1.60. Subprime auto lending has been a sharply growing part of the consumer finance business during the past several years. A number of these companies have been hot properties on Wall Street as consumer credit has expanded rapidly. Several of them have cooled noticeably recently on concerns over consumer credit quality. Mr. Damron pointed out that Eagle faces special problems. There are "both macro and micro issues" now for subprime auto lenders, which finance the purchase of used cars for borrowers who do not have first-class credit ratings. "The macro issue is that many of the nonprime customers are more leveraged today than they were 12 months ago," he said. "They are having more difficulties paying their bills, and so we are seeing slightly higher delinquency levels." Mercury Finance Co., Northbrook, Ill., which is regarded by most analysts as the top company in the subprime sector, has also experienced a rise in delinquencies, Mr. Damron noted, though this has not prompted concern among investors. Mercury also had a sinking spell on Monday, falling $1.625 to $14. By midday Tuesday, it was trading at $14.50. Mr. Damron has "long-term buy" ratings on Mercury and another subprime lender, National Auto Credit Corp. He has an "aggressive buy" rating on Union Acceptance Corp., whose initial public offering took place in August.

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