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Here's Why Euronet Worldwide Climbed 16.8% in February

By Lou Whiteman – Updated Apr 10, 2019 at 2:42PM

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Strong quarterly results suggest the company's growth strategy is delivering as planned.

What happened

Shares of Euronet Worldwide (EEFT -1.17%) were up 16.8% in February, according to data provided by S&P Global Market Intelligence, after the payments and remittance company delivered fourth-quarter earnings that exceeded expectations and said it is well-positioned for future growth.

So what

Euronet delivered fourth-quarter adjusted earnings of $1.37 per share, up 21% year over year and beating expectations for $1.28 per share in earnings, despite light revenue. The company's money transfer segment grew by 17% on a constant currency basis, and although its prepaid revenue was down slightly due to a change in accounting standards, it would have been up 15% absent that change.

A man using a credit-card point-of-sale machine

Image source: Getty Images.

CEO Mike Brown on a call with investors following earnings spoke optimistically about Euronet's strong market position. Euronet's physical network includes more than 43,000 automated teller machines, 973,000 point-of-sale terminals, and 369,000 physical money transfer locations, and the company's money transfer app has 74 million downloads worldwide.

Check out the latest earnings call transcript for Euronet Worldwide.

Now what

Today, the bulk of Euronet's business rests on its ATM network and money-transfer locations, and it's a pretty good business to be in. Both segments are generating steady growth. The real upside for the company comes from the success it's experiencing in signing partnerships with payments and content companies to expand its reach, both in the digital and physical worlds.

The recent results suggest that Euronet's efforts to grow are paying off, and shareholders can expect Euronet to continue to seek out more branded gift-card, payments, and content deals in the quarters to come. Euronet has the foundation in place to continue to generate market-beating results in the quarters to come.

Lou Whiteman has no position in any of the stocks mentioned. The Motley Fool recommends Euronet Worldwide. The Motley Fool has a disclosure policy.

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