The 10-second takeaway
For the quarter ended Aug. 31 (Q1), Global Payments met expectations on revenues and met expectations on earnings per share.
Compared to the prior-year quarter, revenue grew and GAAP earnings per share contracted significantly.
Gross margins expanded, operating margins shrank, net margins shrank.
Global Payments recorded revenue of $590.3 million. The 20 analysts polled by S&P Capital IQ expected sales of $584.7 million on the same basis. GAAP reported sales were 8.8% higher than the prior-year quarter's $542.8 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.87. The 22 earnings estimates compiled by S&P Capital IQ forecast $0.87 per share. GAAP EPS of $0.59 for Q1 were 25% lower than the prior-year quarter's $0.79 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 65.4%, 70 basis points better than the prior-year quarter. Operating margin was 13.6%, 640 basis points worse than the prior-year quarter. Net margin was 7.9%, 390 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $575.2 million. On the bottom line, the average EPS estimate is $0.87.
Next year's average estimate for revenue is $2.38 billion. The average EPS estimate is $3.61.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 240 members out of 267 rating the stock outperform, and 27 members rating it underperform. Among 90 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 83 give Global Payments a green thumbs-up, and seven give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Global Payments is outperform, with an average price target of $49.48.
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