Global payments stock news, Global Payments Inc. (GPN) has been underperforming compared to the Dow Jones Industrial Average (DOWI) in recent months.
Company Profile
With a market cap of $29 billion, Global Payments Inc. (GPN) is a prominent provider of payment technology and software solutions, serving customers across the Americas, Europe, and the Asia-Pacific region. The company operates through two main segments:
Merchant Solutions: Offers an extensive suite of payment processing and enterprise software services.
Issuer Solutions: Assists financial institutions in managing card portfolios and commercial payment systems.
Classified as a “large-cap” stock, Global Payments demonstrates a strong commitment to innovation, delivering secure and seamless payment experiences across card, digital, and check-based platforms. Headquartered in Atlanta, Georgia, the company has expanded internationally through strategic acquisitions and partnerships.
Despite its robust market presence, Global Payments has faced challenges:
Stock Decline: The stock has slipped 19.2% from its 52-week high of $141.77, recorded in February. Over the past three months, shares have only risen by 2.3%, underperforming the Dow Jones Industrial Average's (DOWI) 4.5% gain during the same period.
Year-to-Date (YTD) Comparison: GPN is down 9.7% on a YTD basis, trailing DOWI's impressive 15.4% rise. Additionally, shares have declined 10.6% over the past year, compared to the Dow's 16.6% returns.
However, GPN stock has been consistently trading above its 50-day and 200-day moving averages since November.
In its latest earnings report, Global Payments revealed:
Q3 Adjusted EPS: $3.08, which was weaker than expected.
Adjusted Revenue: $2.4 billion.
Positive Market Reaction: Despite the disappointing figures, shares rose 4.3% on October 30 after the company reaffirmed its 2024 guidance, projecting adjusted net revenue between $9.2 billion and $9.3 billion, and adjusted EPS of $11.54 to $11.70.
The announcement of a $600 million accelerated share repurchase program and a $1.1 billion agreement to sell AdvancedMD highlighted strong capital allocation and a focus on core operations. The Merchant Solutions segment also delivered 6.7% revenue growth and an 8.7% increase in adjusted operating income.
Competitive Landscape
In contrast, rival Corpay, Inc. (CPAY) has been outperforming GPN, with shares gaining 28.9% over the past year and up 26.6% YTD.
Despite GPN’s struggles, analysts remain cautiously optimistic, with a consensus rating of "Moderate Buy" from 34 analysts. The average price target of $132.69 suggests a potential upside of 15.8% from current levels.
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