Oppenheimer Reiterates Outperform on Global Payments (GPN) Following 1Q Report
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Oppenheimer reiterated an Outperform rating and $85.00 price target on Global Payments (NYSE: GPN) following the company's 1Q earnings report. GPN delivered 1Q cash EPS growth of ~10% Y/Y to $0.86 vs. the Street's 0.83 estimates. The company raised its FY17 margin/EPS guide, now calling for up to 50bps (was 40bps) Y/ Y reported margin expansion and cash EPS of $3.45-3.55 (was $3.40-3.50).
Analyst Glenn Greene commented, "Global Payments announced strong 1QFY17 results with 52% Y/Y revenue growth (+5% organic constant currency, by our est.) and cash EPS of $0.86 (vs. our/Street's $0.81/0.83 ests.). EPS benefited by ~$0.04 relative to our estimate from a lower than expected tax rate (28.4% vs. our 30.0%E) and share count (~155M vs. our ~159M est.). Notably, management suggests ahead-of-plan Heartland (HPY) integration progress (now anticipates >$60M cost synergies in FY17 vs. prior expectation of > $50M). Reflecting the upside quarter, GPN raised its FY17 margin/EPS outlook, which now calls for up to 50bps (was 40bps) Y/Y reported margin expansion and reported cash EPS of $3.45-3.55 (was $3.40-3.50). GPN trades at ~19.5x our revised FY18E EPS, which we view as attractive. Maintain Outperform and $85 price target."
Shares of Global Payments closed at $79.04 yesterday.
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