0R15 8520.0 0.0% 0R1E 8203.0 0.0% 0M69 21090.0 67.5139% 0R2V 226.02 9878.8079% 0QYR None None% 0QYP 412.97 -2.8306% 0RUK 2652.0 -9.2402% 0RYA 1554.0 -0.7029% 0RIH 174.55 -1.3563% 0RIH 165.15 -5.3853% 0R1O 198.5 9800.2494% 0R1O None None% 0QFP None None% 0M2Z 267.777 -0.1763% 0VSO 32.05 -9.9846% 0R1I None None% 0QZI 559.0 0.7207% 0QZ0 220.0 0.0% 0NZF None None% 0YXG 165.7358 2.7149%
Company Overview: Global Payments Inc. (NYSE: GPN) is a global payments technology company that provides software and other solutions and services to small and medium-sized businesses in over 100 countries across North America, Europe, Asia Pacific, and Latin America. The company's revenue-generating segments are Merchant Solutions, Issuer Solutions, and Business and Consumer Solutions.
GPN Details
Key Takeaways from FY21 (ended December 31, 2021)
Revenue & Net Income Key Highlights; Analysis by Kalkine Group
Segment Wise Results FY21:
Balance Sheet & Liquidity Position
Recent Developments
Key Metrics: In FY21, GPN's operating and net margins were 15.9% and 10.3%, higher than the industry median of 10.4% and 2.4%, respectively. ROE stood at 3.6%, 150 bps more than the FY20 return. Debt/Equity was 0.47x as of December 31, 2021, higher than 0.35x on December 31, 2020.
Profitability Metrics and Leverage Profile; Analysis by Kalkine Group
Top 10 Shareholders: The top 10 shareholders together form around 39.20% of the total shareholding, while the top 4 constitute the maximum holding. The Vanguard Group, Inc. and Wellington Management Company, LLP hold the maximum stake in the company at 8.28% and 6.16%, respectively, as also highlighted in the chart below:
Top 10 Shareholders; Analysis by Kalkine Group
Risk Analysis
Outlook
Valuation Methodology: EV/Sales Multiple Based Relative Valuation (Illustrative)
Source: Analysis by Kalkine Group
*% Premium/(Discount) is based on our assessment of the company's FY1 trading multiple after considering its key growth drivers, economic moat, stock's historical trading multiples versus peer average/median, and investment risks.
Stock Recommendation: GPN's share price has corrected 27.34% over the past nine months. The stock is currently leaning towards the lower band of its 52-week range of USD 116.75 to USD 220.81. We have valued the stock using the EV/Sales multiple-based illustrative relative valuation method and arrived at a target price with an upside of mid-twenties (in percentage terms). We believe that the company can trade at a premium compared to its peer's average, considering its strong margins and robust ROE. We have taken peers like EVO Payments, Inc. (NASDAQ: EVOP) and Automatic Data Processing, Inc. (NASDAQ: ADP). Considering the solid financial performance, robust margins, ease of COVID-19 restriction and economic recovery, associated risks, and current valuation, we give a "Buy" recommendation on the stock at the closing market price of USD 140.50, up 0.52% as of April 04, 2022.
GPN Technical Chart, Data Source: REFINITIV
Technical Indicators Defined
Support: A level where-in the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.
Resistance: A level where-in the stock prices tend to find resistance when they are rising, and the uptrend may take a pause due to profit booking or selling interest.
Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.
Note 1: The reference data in this report has been partly sourced from REFINITIV.
Note 2: Investment decision should be made depending on the investors' appetite for upside potential, risks, holding duration, and any previous holdings. Investors can consider exiting from the stock if the Target Price mentioned as per the valuation has been achieved and subject to the factors discussed above.
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