What happened
Shares of financial services company Euronet Worldwide, Inc. (EEFT 1.33%) jumped as much as 14.8% in early trading Monday after the company announced a big expected jump in 2019 earnings. Shares were maintaining a 12.5% gain on the day as of 11:20 a.m. EDT.
So what
Last week, Visa announced that it would allow dynamic currency conversion (DCC) for international ATM transactions in April 2019, adding to DCC on point-of-sale transactions. Visa also said it will allow for ATM shared deposits, account-to-account transfers, mini-statements, and PIN changes, which could allow for opportunities for Euronet to add services.
Image source: Getty Images.
The additions will allow Euronet to offer ATM DCC and other services to its partners, which is already expected to have a big impact on the business. Management said 2019 adjusted earnings per share are expected to be $0.60 to $0.65 higher based on the recently announced changes from Visa.
Now what
2019 earnings estimates from Wall Street were for $6.22 per share in earnings, so it's possible Visa's changes will increase earnings by 10%. It's no wonder the stock is up a similar amount in early trading this week.
I don't see any reason to think Euronet will give back today's gains, but if that happens in coming days, it will be a great buying opportunity for investors. For now, it seems like there's no downside to opening up more services on ATM transactions worldwide.
