Flywire is the IBD Stock Of The Day as shares in the education payment software and services firm climbed after its first-quarter earnings report. FLYW stock has gained 20% in 2023, outperforming the S&P 500 index, which is up 8%.
Boston-based Flywire has expanded from its roots in education to health care, travel and business-to-business payment services.
"Flywire's next-gen payments platform, proprietary global payment network and vertical-specific software help clients get paid while helping their end customers (students) pay with ease," Bank of America analyst Jason Kupferberg said in a report.
"Flywire's solutions help customers migrate away from paper-based payments and manual business processes, to much more efficient electronic forms of payment."
On the stock market today, FLYW stock rose 1.7% to close at 29.36. Earlier in the session, it hit a 52-week high of 30.96. Flywire reported first-quarter results late Tuesday.
FLYW Stock: Defensive Business Mix?
In the wake of its first-quarter earnings report, Flywire stock rebounded from its 50-day moving average line. Off the 50-day line bounce, FLYW stock forged an entry point of 29.85.
Meanwhile, the payment stock holds an IBD Composite Rating of 78 out of a best-possible 99, according to IBD Stock Checkup. IBD's Composite Rating combines five separate proprietary ratings into one easy-to-use rating. The best growth stocks have a Composite Rating of 90 or better.
FLYW stock has an IBD Relative Strength Rating of 93 out of 99. That puts it in the top 7% of stocks for performance over the past 12 months.
For the March quarter, Flywire reported an adjusted loss of 3 cents per share. In the year-earlier period, it posted a loss of 10 cents a share.
"The company put up a very strong top-line beat, and we believe it is well positioned to drive better-than-expected margin expansion this year," Goldman Sachs analyst Will Nance said in a report.
He added: "We see the company's defensive business mix in education and health care as well positioned to absorb the potential for macro (economic) weakness for the remainder of this year."
Flywire Sales Top Estimates
Revenue rose 46% to $94.4 million in the March-ended quarter, topping estimates of $89.1 million.
Revenue less "ancillary services" increased 50.3% to $89.1 million vs. estimates of 40% growth. That revenue excludes the pass-through cost for printing and mailing services and marketing fees.
Earnings before interest, taxes, depreciation and amortization came in at $7 million, topping estimates of $4.5 million.
"We continue to believe that Flywire's underlying operating leverage along with continued streamlining efforts should help deliver" improved margins, Morgan Stanley analyst James Faucette said in a report.
Total payment volume increased 35.8% to $5.7 billion, up 36% in the first quarter.
Flywire Customer Wins A Bright Spot
"The momentum in Flywire's business seems to fly in the face of a questionable economic backdrop," RBC Capital analyst Daniel Perlman said in a report. "Yet, a combo platter of strong net revenue retention, record-setting new customer wins and strong sales pipeline continue to support 35%-plus year-over-year top-line growth."
Further, FLYW stock has an Accumulation/Distribution Rating of A-. That rating analyzes price and volume changes in a stock over the past 13 weeks of trading. Its current rating indicates more funds are buying than selling.
On the Q1 earnings call, "management reiterated Flywire's continued investment in its go-to-market strategy, accelerating channel and tech partners across verticals," Kupferberg said.
Also, FLYW stock is on the IBD 50 list.
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