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Atlanta, Georgia-based Global Payments Inc. (GPN) provides payment technology and software solutions for card, check, and digital-based payments. With a market cap of $29.6 billion, the company operates through Merchant Solutions and Issuer Solutions segments.
The payments giant has significantly underperformed the broader market over the past year. GPN stock has dipped 8.4% on a YTD basis and gained 6.6% over the past year, compared to the S&P 500 Index’s ($SPX) 25.5% gains in 2024 and 35.5% returns over the past year.
Narrowing the focus, Global Payments has also underperformed the Global X FinTech ETF’s (FINX) surge of 28.9% on a YTD basis and 65.9% over the past year.
Despite missing Wall Street’s revenue and earnings estimates, shares of Global Payments surged 4.3% after the release of its Q3 earnings on Oct. 30. The company reported a 5.1% year-over-year growth in revenues to $2.6 billion, falling short of analysts’ topline estimates by a small margin. Meanwhile, its adjusted EPS grew by 12% compared to the year-ago quarter to $3.08, missing Wall Street’s earnings estimates. However, it reaffirmed its solid full-year revenue growth guidance of 6% to 7% and adjusted EPS growth guidance of 11% to 12%. The company also expects to report a 50-basis point expansion in its annual adjusted operating margin. Moreover, GPN entered into a $600 million accelerated share repurchase plan demonstrating its commitment to shareholders.
For the current fiscal, ending in December, analysts expect GPN to report a 12.8% year-over-year growth in adjusted EPS to $11.03. The company’s earnings surprise history is mixed. It surpassed analysts’ bottom-line estimates in three of the past four quarters while missing on another occasion.
GPN stock has a consensus “Moderate Buy” rating overall. Among the 35 analysts covering the stock, 19 advise “Strong Buy,” three suggest “Moderate Buy,” 11 recommend “Hold,” and two advocate a “Strong Sell” rating.
This configuration is less bullish than three months ago, with 24 “Strong Buy” ratings on the stock.
On Oct. 31, RBC Capital analyst Daniel Perlin maintained an “Outperform” rating on GPN while lowering the price target to $130.
GPN’s mean price target of $131.12 represents a premium of 12.7% to the current price level. The Street-high target of $194 suggests a potential upside of 66.7%.
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