GLOBAL PAYMENTS INC (GPN) Stock Fundamental Analysis
NYSE:GPN - New York Stock Exchange, Inc. - US37940X1028 - Common Stock - Currency: USD
Overall GPN gets a fundamental rating of 5 out of 10. We evaluated GPN against 100 industry peers in the Financial Services industry. GPN scores excellent on profitability, but there are concerns on its financial health. GPN may be a bit undervalued, certainly considering the very reasonable score on growth
1. Profitability
1.1 Basic Checks
In the past year GPN was profitable.
In the past year GPN had a positive cash flow from operations.
GPN had positive earnings in each of the past 5 years.
Each year in the past 5 years GPN had a positive operating cash flow.
1.2 Ratios
GPN's Return On Assets of 3.28% is fine compared to the rest of the industry. GPN outperforms 67.00% of its industry peers.
The Return On Equity of GPN (7.02%) is comparable to the rest of the industry.
With a decent Return On Invested Capital value of 4.84%, GPN is doing good in the industry, outperforming 63.00% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for GPN is significantly below the industry average of 11.84%.
The last Return On Invested Capital (4.84%) for GPN is above the 3 year average (4.36%), which is a sign of increasing profitability.
| 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
Looking at the Profit Margin, with a value of 15.48%, GPN is in the better half of the industry, outperforming 66.00% of the companies in the same industry.
GPN's Profit Margin has improved in the last couple of years.
GPN's Operating Margin of 23.72% is fine compared to the rest of the industry. GPN outperforms 70.00% of its industry peers.
GPN's Operating Margin has improved in the last couple of years.
GPN has a better Gross Margin (62.77%) than 76.00% of its industry peers.
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
GPN has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for GPN has been reduced compared to 1 year ago.
The number of shares outstanding for GPN has been reduced compared to 5 years ago.
Compared to 1 year ago, GPN has a worse debt to assets ratio.
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.
GPN has a Altman-Z score (0.99) which is comparable to the rest of the 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.
Looking at the Debt to FCF ratio, with a value of 5.61, GPN is in the better half of the industry, outperforming 65.00% of the companies in the same industry.
GPN has a Debt/Equity ratio of 0.71. This is a neutral value indicating GPN is somewhat dependend on debt financing.
GPN's Debt to Equity ratio of 0.71 is in line compared to the rest of the industry. GPN outperforms 53.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.71 | ||
| Debt/FCF | 5.61 | ||
| Altman-Z | 0.99 |
ROIC/WACC0.66
WACC7.38%
2.3 Liquidity
A Current Ratio of 0.94 indicates that GPN may have some problems paying its short term obligations.
GPN has a Current ratio of 0.94. This is comparable 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.
Looking at the Quick ratio, with a value of 0.94, GPN is in line with its industry, outperforming 47.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.94 | ||
| Quick Ratio | 0.94 |
3. Growth
3.1 Past
GPN shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 9.80%, which is quite good.
Measured over the past years, GPN shows a quite strong growth in Earnings Per Share. The EPS has been growing by 13.36% on average per year.
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
The Earnings Per Share is expected to grow by 9.75% on average over the next years. This is quite good.
Based on estimates for the next years, GPN will show a small growth in Revenue. The Revenue will grow by 6.01% on average per year.
EPS Next Y5.74%
EPS Next 2Y8.9%
EPS Next 3Y10.54%
EPS Next 5Y9.75%
Revenue Next Year1.35%
Revenue Next 2Y3.8%
Revenue Next 3Y4.85%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 7.03, the valuation of GPN can be described as very cheap.
Compared to the rest of the industry, the Price/Earnings ratio of GPN indicates a rather cheap valuation: GPN is cheaper than 86.00% of the companies listed in the same industry.
GPN's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 27.45.
A Price/Forward Earnings ratio of 5.98 indicates a rather cheap valuation of GPN.
GPN's Price/Forward Earnings ratio is rather cheap when compared to the industry. GPN is cheaper than 85.00% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.90, GPN is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.03 | ||
| Fwd PE | 5.98 |
4.2 Price Multiples
GPN's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. GPN is cheaper than 80.00% of the companies in the same industry.
91.00% of the companies in the same industry are more expensive than GPN, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 6.62 | ||
| EV/EBITDA | 7.83 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of GPN may justify a higher PE ratio.
PEG (NY)1.22
PEG (5Y)0.53
EPS Next 2Y8.9%
EPS Next 3Y10.54%
5. Dividend
5.1 Amount
GPN has a Yearly Dividend Yield of 1.22%. Purely for dividend investing, there may be better candidates out there.
GPN's Dividend Yield is a higher than the industry average which is at 4.87.
With a Dividend Yield of 1.22, GPN pays less dividend than the S&P500 average, which is at 2.38.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.22% |
5.2 History
On average, the dividend of GPN grows each year by 21.27%, which is quite nice.
GPN has paid a dividend for at least 10 years, which is 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
GPN pays out 16.02% of its income as dividend. This is a 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 2Y8.9%
EPS Next 3Y10.54%
81.85
-0.14 (-0.17%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryFinancial Services
Earnings (Last)
Earnings (Next)
Inst Owners94.25%
Inst Owner Change-58.81%
Ins Owners0.53%
Ins Owner Change6.62%
Market Cap19.96B
Analysts69.47
Price Target99.6 (21.69%)
Short Float %5.21%
Short Ratio3.31
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.22% |
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)-7.61%
PT rev (3m)-24.99%
EPS NQ rev (1m)0.05%
EPS NQ rev (3m)-2.05%
EPS NY rev (1m)0.04%
EPS NY rev (3m)-1.85%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.34%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.16%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.03 | ||
| Fwd PE | 5.98 | ||
| P/S | 1.98 | ||
| P/FCF | 6.62 | ||
| P/OCF | 5.44 | ||
| P/B | 0.9 | ||
| P/tB | N/A | ||
| EV/EBITDA | 7.83 |
EPS(TTM)11.65
EY14.23%
EPS(NY)13.7
Fwd EY16.74%
FCF(TTM)12.36
FCFY15.1%
OCF(TTM)15.05
OCFY18.39%
SpS41.4
BVpS91.23
TBVpS-52.64
PEG (NY)1.22
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
WACC7.38%
ROIC/WACC0.66
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 Y5.74%
EPS Next 2Y8.9%
EPS Next 3Y10.54%
EPS Next 5Y9.75%
Revenue 1Y (TTM)3.23%
Revenue growth 3Y5.84%
Revenue growth 5Y15.52%
Sales Q2Q%0.96%
Revenue Next Year1.35%
Revenue Next 2Y3.8%
Revenue Next 3Y4.85%
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%