GLOBAL PAYMENTS INC (GPN)
US37940X1028 - Common Stock
GPN gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 101 industry peers in the Financial Services industry. While GPN has a great profitability rating, there are quite some 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.
GPN had a positive operating cash flow in the past year.
GPN had positive earnings in each of the past 5 years.
GPN had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
GPN has a better Return On Assets (1.79%) than 62.38% of its industry peers.
GPN's Return On Equity of 3.90% is in line compared to the rest of the industry. GPN outperforms 42.57% of its industry peers.
Looking at the Return On Invested Capital, with a value of 3.78%, GPN is in the better half of the industry, outperforming 71.29% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for GPN is below the industry average of 7.13%.
The 3 year average ROIC (3.20%) for GPN is below the current ROIC(3.78%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.79% | ||
| ROE | 3.9% | ||
| ROIC | 3.78% |
ROA(3y)1.23%
ROA(5y)1.62%
ROE(3y)2.14%
ROE(5y)3.86%
ROIC(3y)3.2%
ROIC(5y)3.49%
1.3 Margins
Looking at the Profit Margin, with a value of 9.23%, GPN is in line with its industry, outperforming 53.47% of the companies in the same industry.
GPN's Profit Margin has declined in the last couple of years.
GPN has a Operating Margin of 21.94%. This is in the better half of the industry: GPN outperforms 69.31% of its industry peers.
In the last couple of years the Operating Margin of GPN has grown nicely.
GPN's Gross Margin of 60.59% is amongst the best of the industry. GPN outperforms 83.17% of its industry peers.
GPN's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 21.94% | ||
| PM (TTM) | 9.23% | ||
| GM | 60.59% |
OM growth 3Y0.3%
OM growth 5Y8.87%
PM growth 3Y-47.86%
PM growth 5Y-36.23%
GM growth 3Y-0.38%
GM growth 5Y2.5%
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.
GPN has less shares outstanding than it did 1 year ago.
The number of shares outstanding for GPN has been increased 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 1.15. This is a bad value and indicates that GPN is not financially healthy and even has some risk of bankruptcy.
GPN has a better Altman-Z score (1.15) than 62.38% of its industry peers.
GPN has a debt to FCF ratio of 10.54. This is a negative value and a sign of low solvency as GPN would need 10.54 years to pay back of all of its debts.
GPN has a Debt to FCF ratio of 10.54. This is comparable to the rest of the industry: GPN outperforms 52.48% of its industry peers.
A Debt/Equity ratio of 0.77 indicates that GPN is somewhat dependend on debt financing.
The Debt to Equity ratio of GPN (0.77) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.77 | ||
| Debt/FCF | 10.54 | ||
| Altman-Z | 1.15 |
ROIC/WACC0.51
WACC7.36%
2.3 Liquidity
GPN has a Current Ratio of 1.09. This is a normal value and indicates that GPN is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.09, GPN is in line with its industry, outperforming 46.53% of the companies in the same industry.
A Quick Ratio of 1.09 indicates that GPN should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.09, GPN is in line with its industry, outperforming 49.51% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.09 | ||
| Quick Ratio | 1.09 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 12.72% over the past year.
GPN shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 18.40% yearly.
Looking at the last year, GPN shows a small growth in Revenue. The Revenue has grown by 6.25% in the last year.
Measured over the past years, GPN shows a quite strong growth in Revenue. The Revenue has been growing by 17.69% on average per year.
EPS 1Y (TTM)12.72%
EPS 3Y14.78%
EPS 5Y18.4%
EPS growth Q2Q10.89%
Revenue 1Y (TTM)6.25%
Revenue growth 3Y22.26%
Revenue growth 5Y17.69%
Revenue growth Q2Q8.33%
3.2 Future
GPN is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 14.66% yearly.
Based on estimates for the next years, GPN will show a small growth in Revenue. The Revenue will grow by 6.18% on average per year.
EPS Next Y12.63%
EPS Next 2Y12.96%
EPS Next 3Y13.24%
EPS Next 5Y14.66%
Revenue Next Year7.38%
Revenue Next 2Y7.26%
Revenue Next 3Y7.23%
Revenue Next 5Y6.18%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
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
A Price/Earnings ratio of 11.79 indicates a reasonable valuation of GPN.
Based on the Price/Earnings ratio, GPN is valued a bit cheaper than the industry average as 65.35% of the companies are valued more expensively.
GPN's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 24.54.
The Price/Forward Earnings ratio is 10.09, which indicates a very decent valuation of GPN.
GPN's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. GPN is cheaper than 67.33% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of GPN to the average of the S&P500 Index (20.22), we can say GPN is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.79 | ||
| Fwd PE | 10.09 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, GPN is valued a bit cheaper than 72.28% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of GPN indicates a somewhat cheap valuation: GPN is cheaper than 62.38% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.99 | ||
| EV/EBITDA | 12.08 |
4.3 Compensation for Growth
GPN's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The decent profitability rating of GPN may justify a higher PE ratio.
A more expensive valuation may be justified as GPN's earnings are expected to grow with 13.24% in the coming years.
PEG (NY)0.93
PEG (5Y)0.64
EPS Next 2Y12.96%
EPS Next 3Y13.24%
5. Dividend
5.1 Amount
With a yearly dividend of 0.83%, GPN is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 3.79, GPN pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.55, GPN's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.83% |
5.2 History
The dividend of GPN is nicely growing with an annual growth rate of 87.54%!
GPN has been paying a dividend for at least 10 years, so it has a reliable track record.
GPN has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)87.54%
Div Incr Years4
Div Non Decr Years5
5.3 Sustainability
GPN pays out 29.91% of its income as dividend. This is a sustainable payout ratio.
GPN's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP29.91%
EPS Next 2Y12.96%
EPS Next 3Y13.24%
GLOBAL PAYMENTS INC
NYSE:GPN (12/8/2023, 7:04:00 PM)
After market: 120.78 +0.62 (+0.52%)120.16
+0.29 (+0.24%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryFinancial Services
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap31.29B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.83% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
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EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
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Min Revenue beat(4)
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Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
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Revenue beat(16)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.79 | ||
| Fwd PE | 10.09 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)0.93
PEG (5Y)0.64
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.79% | ||
| ROE | 3.9% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 21.94% | ||
| PM (TTM) | 9.23% | ||
| GM | 60.59% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.19
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.77 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.09 | ||
| Quick Ratio | 1.09 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)12.72%
EPS 3Y14.78%
EPS 5Y
EPS growth Q2Q
EPS Next Y12.63%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)6.25%
Revenue growth 3Y22.26%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y