Global Payments Earnings Preview

Global Payments (NYSE: GPN  ) hasn't been able to establish an earnings trend, bouncing between beating and falling short of estimates during the past fiscal year. The company will unveil its latest earnings on Thursday. Global Payments is a processor of electronic transactions.

What analysts say:

  • Buy, sell, or hold?: The majority of analysts back Global Payments as a buy. But with 57.7% of analysts rating it a buy, Global Payments is still below the mean analyst rating of its nearest 10 competitors, which average 69.6% buys. Analysts don't like Global Payments as much as competitor Green Dot overall. Twelve out of 20 analysts rate Green Dot a buy compared to 15 of 26 for Global Payments. Analysts still rate the stock a moderate buy, but they are a bit more wary about it compared to three months ago.
  • Revenue forecasts: On average, analysts predict $524.2 million in revenue this quarter. That would represent a rise of 18.2% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.86 per share. Estimates range from $0.78 to $0.90.

What our community says:
CAPS All-Stars are solidly backing the stock with 95.7% awarding it an outperform rating. The community at large backs the All-Stars with 90.7% assigning it a rating of "outperform." Fools are gung-ho about Global Payments, though the message boards have been quiet lately with only 84 posts in the past 30 days. Global Payments has a bullish CAPS rating of five out of five stars that is about on par with the Fool community assessment.

Management:
Global Payments' profit has risen year over year by an average of 21.2% over the past five quarters. Revenue has now gone up for three straight quarters.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter

Q1

Q4

Q3

Q2

Gross Margin

64.7%

63.2%

63.1%

65.2%

Operating Margin

20.0%

17.0%

17.1%

18.7%

Net Margin

11.8%

11.3%

10.5%

12.1%

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Earnings estimates provided by Zacks

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