GLOBAL PAYMENTS INC (GPN) Stock Fundamental Analysis
NYSE:GPN - New York Stock Exchange, Inc. - US37940X1028 - Common Stock - Currency: USD
GPN gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 100 industry peers in the Financial Services industry. GPN scores excellent on profitability, but there are concerns on its financial health. GPN scores decently on growth, while it is valued quite cheap. This could make an interesting combination.
1. Profitability
1.1 Basic Checks
In the past year GPN was profitable.
GPN had a positive operating cash flow in the past year.
In the past 5 years GPN has always been profitable.
GPN had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 3.28%, GPN is in the better half of the industry, outperforming 67.00% of the companies in the same industry.
Looking at the Return On Equity, with a value of 7.02%, GPN is in line with its industry, outperforming 45.00% of the companies in the same industry.
GPN has a better Return On Invested Capital (4.84%) than 63.00% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for GPN is significantly below the industry average of 11.84%.
The 3 year average ROIC (4.36%) for GPN is below the current ROIC(4.84%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.28% | ||
| ROE | 7.02% | ||
| ROIC | 4.84% |
ROA(3y)1.85%
ROA(5y)1.8%
ROE(3y)3.95%
ROE(5y)3.55%
ROIC(3y)4.36%
ROIC(5y)3.81%
1.3 Margins
GPN has a Profit Margin of 15.48%. This is in the better half of the industry: GPN outperforms 66.00% of its industry peers.
In the last couple of years the Profit Margin of GPN has grown nicely.
GPN has a Operating Margin of 23.72%. This is in the better half of the industry: GPN outperforms 70.00% of its industry peers.
In the last couple of years the Operating Margin of GPN has grown nicely.
Looking at the Gross Margin, with a value of 62.77%, GPN is in the better half of the industry, outperforming 76.00% of the companies in the same industry.
GPN's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 23.72% | ||
| PM (TTM) | 15.48% | ||
| GM | 62.77% |
OM growth 3Y5.13%
OM growth 5Y1.68%
PM growth 3Y11.11%
PM growth 5Y12.13%
GM growth 3Y3.83%
GM growth 5Y1.31%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so GPN is destroying value.
GPN has less shares outstanding than it did 1 year ago.
GPN has less shares outstanding than it did 5 years ago.
GPN has a worse debt/assets ratio than last year.
2.2 Solvency
GPN has an Altman-Z score of 0.99. This is a bad value and indicates that GPN is not financially healthy and even has some risk of bankruptcy.
With a Altman-Z score value of 0.99, GPN perfoms like the industry average, outperforming 60.00% of the companies in the same industry.
GPN has a debt to FCF ratio of 5.61. This is a neutral value as GPN would need 5.61 years to pay back of all of its debts.
GPN has a better Debt to FCF ratio (5.61) than 65.00% of its industry peers.
GPN has a Debt/Equity ratio of 0.71. This is a neutral value indicating GPN is somewhat dependend on debt financing.
GPN has a Debt to Equity ratio (0.71) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.71 | ||
| Debt/FCF | 5.61 | ||
| Altman-Z | 0.99 |
ROIC/WACC0.65
WACC7.45%
2.3 Liquidity
GPN has a Current Ratio of 0.94. This is a bad value and indicates that GPN is not financially healthy enough and could expect problems in meeting its short term obligations.
GPN's Current ratio of 0.94 is in line compared to the rest of the industry. GPN outperforms 44.00% of its industry peers.
A Quick Ratio of 0.94 indicates that GPN may have some problems paying its short term obligations.
GPN has a Quick ratio (0.94) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.94 | ||
| Quick Ratio | 0.94 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 9.80% over the past year.
GPN shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 13.36% yearly.
GPN shows a small growth in Revenue. In the last year, the Revenue has grown by 3.23%.
The Revenue has been growing by 15.52% on average over the past years. This is quite good.
EPS 1Y (TTM)9.8%
EPS 3Y12.23%
EPS 5Y13.36%
EPS Q2Q%3.86%
Revenue 1Y (TTM)3.23%
Revenue growth 3Y5.84%
Revenue growth 5Y15.52%
Sales Q2Q%0.96%
3.2 Future
Based on estimates for the next years, GPN will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.75% on average per year.
GPN is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.01% yearly.
EPS Next Y5.85%
EPS Next 2Y8.97%
EPS Next 3Y10.46%
EPS Next 5Y9.75%
Revenue Next Year1.36%
Revenue Next 2Y3.82%
Revenue Next 3Y5.03%
Revenue Next 5Y6.01%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
GPN is valuated cheaply with a Price/Earnings ratio of 7.03.
86.00% of the companies in the same industry are more expensive than GPN, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 27.50, GPN is valued rather cheaply.
GPN is valuated cheaply with a Price/Forward Earnings ratio of 5.97.
Based on the Price/Forward Earnings ratio, GPN is valued cheaply inside the industry as 84.00% of the companies are valued more expensively.
GPN is valuated cheaply when we compare the Price/Forward Earnings ratio to 36.44, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.03 | ||
| Fwd PE | 5.97 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, GPN is valued a bit cheaper than 79.00% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, GPN is valued cheaply inside the industry as 89.00% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 6.63 | ||
| EV/EBITDA | 7.9 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
GPN has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.2
PEG (5Y)0.53
EPS Next 2Y8.97%
EPS Next 3Y10.46%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.23%, GPN has a reasonable but not impressive dividend return.
GPN's Dividend Yield is a higher than the industry average which is at 4.86.
With a Dividend Yield of 1.23, GPN pays less dividend than the S&P500 average, which is at 2.35.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.23% |
5.2 History
The dividend of GPN is nicely growing with an annual growth rate of 21.27%!
GPN has been paying a dividend for at least 10 years, so it has a reliable track record.
As GPN did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)21.27%
Div Incr Years0
Div Non Decr Years6
5.3 Sustainability
16.02% of the earnings are spent on dividend by GPN. This is a low number and sustainable payout ratio.
The dividend of GPN is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP16.02%
EPS Next 2Y8.97%
EPS Next 3Y10.46%
81.93
-1.11 (-1.34%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryFinancial Services
Earnings (Last)
Earnings (Next)
Inst Owners94.25%
Inst Owner Change0.01%
Ins Owners0.53%
Ins Owner Change6.65%
Market Cap19.98B
Analysts69.47
Price Target99.6 (21.57%)
Short Float %3.68%
Short Ratio3.01
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.23% |
Yearly Dividend0.99
Dividend Growth(5Y)21.27%
DP16.02%
Div Incr Years0
Div Non Decr Years6
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-1.59%
Min EPS beat(2)-1.97%
Max EPS beat(2)-1.2%
EPS beat(4)1
Avg EPS beat(4)-1.36%
Min EPS beat(4)-2.29%
Max EPS beat(4)0.03%
EPS beat(8)3
Avg EPS beat(8)-0.7%
EPS beat(12)4
Avg EPS beat(12)-0.37%
EPS beat(16)7
Avg EPS beat(16)0.13%
Revenue beat(2)0
Avg Revenue beat(2)-1.25%
Min Revenue beat(2)-1.67%
Max Revenue beat(2)-0.82%
Revenue beat(4)0
Avg Revenue beat(4)-1.28%
Min Revenue beat(4)-1.96%
Max Revenue beat(4)-0.68%
Revenue beat(8)0
Avg Revenue beat(8)-0.95%
Revenue beat(12)4
Avg Revenue beat(12)2.05%
Revenue beat(16)8
Avg Revenue beat(16)4.11%
PT rev (1m)-0.79%
PT rev (3m)-24.99%
EPS NQ rev (1m)0.15%
EPS NQ rev (3m)-1.37%
EPS NY rev (1m)0.15%
EPS NY rev (3m)-1.75%
Revenue NQ rev (1m)0.04%
Revenue NQ rev (3m)0.42%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)0.21%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.03 | ||
| Fwd PE | 5.97 | ||
| P/S | 1.98 | ||
| P/FCF | 6.63 | ||
| P/OCF | 5.44 | ||
| P/B | 0.9 | ||
| P/tB | N/A | ||
| EV/EBITDA | 7.9 |
EPS(TTM)11.65
EY14.22%
EPS(NY)13.72
Fwd EY16.74%
FCF(TTM)12.36
FCFY15.09%
OCF(TTM)15.05
OCFY18.37%
SpS41.4
BVpS91.23
TBVpS-52.64
PEG (NY)1.2
PEG (5Y)0.53
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.28% | ||
| ROE | 7.02% | ||
| ROCE | 5.92% | ||
| ROIC | 4.84% | ||
| ROICexc | 5.2% | ||
| ROICexgc | 61.84% | ||
| OM | 23.72% | ||
| PM (TTM) | 15.48% | ||
| GM | 62.77% | ||
| FCFM | 29.85% |
ROA(3y)1.85%
ROA(5y)1.8%
ROE(3y)3.95%
ROE(5y)3.55%
ROIC(3y)4.36%
ROIC(5y)3.81%
ROICexc(3y)4.61%
ROICexc(5y)4.02%
ROICexgc(3y)47.47%
ROICexgc(5y)47.57%
ROCE(3y)5.34%
ROCE(5y)4.65%
ROICexcg growth 3Y5.38%
ROICexcg growth 5Y12.85%
ROICexc growth 3Y11.96%
ROICexc growth 5Y18.11%
OM growth 3Y5.13%
OM growth 5Y1.68%
PM growth 3Y11.11%
PM growth 5Y12.13%
GM growth 3Y3.83%
GM growth 5Y1.31%
F-Score8
Asset Turnover0.21
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.71 | ||
| Debt/FCF | 5.61 | ||
| Debt/EBITDA | 3.71 | ||
| Cap/Depr | 35.45% | ||
| Cap/Sales | 6.51% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 86.41% | ||
| Profit Quality | 192.89% | ||
| Current Ratio | 0.94 | ||
| Quick Ratio | 0.94 | ||
| Altman-Z | 0.99 |
F-Score8
WACC7.45%
ROIC/WACC0.65
Cap/Depr(3y)36.77%
Cap/Depr(5y)33.3%
Cap/Sales(3y)6.79%
Cap/Sales(5y)6.4%
Profit Quality(3y)601.21%
Profit Quality(5y)472.37%
High Growth Momentum
Growth
EPS 1Y (TTM)9.8%
EPS 3Y12.23%
EPS 5Y13.36%
EPS Q2Q%3.86%
EPS Next Y5.85%
EPS Next 2Y8.97%
EPS Next 3Y10.46%
EPS Next 5Y9.75%
Revenue 1Y (TTM)3.23%
Revenue growth 3Y5.84%
Revenue growth 5Y15.52%
Sales Q2Q%0.96%
Revenue Next Year1.36%
Revenue Next 2Y3.82%
Revenue Next 3Y5.03%
Revenue Next 5Y6.01%
EBIT growth 1Y3.13%
EBIT growth 3Y11.27%
EBIT growth 5Y17.46%
EBIT Next Year11.34%
EBIT Next 3Y8.37%
EBIT Next 5Y9.19%
FCF growth 1Y89.38%
FCF growth 3Y7.7%
FCF growth 5Y21.41%
OCF growth 1Y65.87%
OCF growth 3Y8.3%
OCF growth 5Y20.49%