CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
FI’s Q1 earnings were strong and are being well received today, driven by 1) better-than-expected bottom line results (adj-EPS of $1.88 surpassed consensus by $0.09); 2) sustained Clover revenue uptick, up 30% Y/Y with VAS penetration of 20%; and 3) raised 2024 guidance for adj-EPS of $8.60-$8.75 and adj-operating margin expansion of at least 125 bps. Q1 adj-revenues came in at $4.54B (+7%, +20% organically), led by Merchant Solutions (+13%, +36% organically). Financial Solutions were a little softer (+2%, +5% organically), but we note key client wins should support demand for digital payment solutions. Our 12-month target price of $180 (unchanged), 18.1x our 2025 EPS estimate, is a slight premium to FI’s three-year average of 17.0x. We up our 2024 EPS view by $0.10 to $8.75 and keep 2025’s at $9.95. Our outlook remains positive given the opportunity we see in Merchant Solutions, specifically Clover, based on sustained annualized GPV growth (+19% in Q1), upcoming product launches, and international expansion.