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Global Payments' (GPN) Q4 Earnings Top Estimates, Rise Y/Y
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Global Payments Inc. (GPN - Free Report) came up with fourth-quarter 2018 adjusted earnings of $1.33 per share, beating the Zacks Consensus Estimate by 0.8% and also improving 24.3% year over year.
The reported quarter benefited both from the company’s higher revenues and decreased expenses.
Behind the Headlines
Adjusted net revenues plus network fees were $1.04 billion, up 13% year over year. The top line also marginally surpassed the Zacks Consensus Estimate by 0.1%, mainly driven by segmental performances.
Total operating expense of $713.6 million decreased 21.2% year over year, led by a lower cost of services.
Adjusted operating margin expanded 80 basis points to 31.6%.
Global Payments Inc. Price, Consensus and EPS Surprise
North America: Adjusted net revenues plus network fees of $765 million increased 13.9% year over year. Operating income of $247 million was up 20% year over year.
Europe: Adjusted net revenues plus network fees of $188 million grew 7.7% year over year. Operating income of $89.6 million rose 7.6% year over year.
Asia-Pacific: Adjusted net revenues plus network fees of $84.7 million climbed 9.5% year over year. Operating income of $29 million improved 10.7% year over year.
Share Repurchase and Dividend Update
Global Payments’ board of directors has approved a dividend of 1 cent per share, payable Mar 29, 2019 to shareholders of record as of Mar 15, 2019.
The company ramped up its share repurchase program to $750 million.
Balance Sheet Position
Total cash and cash equivalents as of Dec 31, 2018 were $1.2 billion, down 9.4% from $1.3 billion as of Dec 31, 2017.
Long-term debt as of Dec 31, 2018 was $5 billion, up 10% from the level at 2017 end.
Net cash provided by operating activities for 2018 was $1.1 billion, up 116% year over year.
Full-Year Highlights
For 2018, adjusted revenues plus network fees increased 15% to $3.97 billion. Adjusted earnings per share grew $5.19, up 29% year over year.
2019 Outlook
For 2019, the company expects adjusted net revenues plus network fees in the band of $4.43-$4.49 billion. Adjusted EPS is projected in the range of $5.90-$6.10.
Zacks Rank and Performances of Other Industry Players
Among other players from the finance sector having reported fourth-quarter earnings so far, the bottom-line results of Synchrony Financial (SYF - Free Report) , Intercontinental Exchange Inc. (ICE - Free Report) and MarketAxess Holdings Inc. (MKTX - Free Report) outpaced the respective Zacks Consensus Estimate.
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Global Payments' (GPN) Q4 Earnings Top Estimates, Rise Y/Y
Global Payments Inc. (GPN - Free Report) came up with fourth-quarter 2018 adjusted earnings of $1.33 per share, beating the Zacks Consensus Estimate by 0.8% and also improving 24.3% year over year.
The reported quarter benefited both from the company’s higher revenues and decreased expenses.
Behind the Headlines
Adjusted net revenues plus network fees were $1.04 billion, up 13% year over year. The top line also marginally surpassed the Zacks Consensus Estimate by 0.1%, mainly driven by segmental performances.
Total operating expense of $713.6 million decreased 21.2% year over year, led by a lower cost of services.
Adjusted operating margin expanded 80 basis points to 31.6%.
Global Payments Inc. Price, Consensus and EPS Surprise
Global Payments Inc. Price, Consensus and EPS Surprise | Global Payments Inc. Quote
Growth Across Segments
North America: Adjusted net revenues plus network fees of $765 million increased 13.9% year over year. Operating income of $247 million was up 20% year over year.
Europe: Adjusted net revenues plus network fees of $188 million grew 7.7% year over year. Operating income of $89.6 million rose 7.6% year over year.
Asia-Pacific: Adjusted net revenues plus network fees of $84.7 million climbed 9.5% year over year. Operating income of $29 million improved 10.7% year over year.
Share Repurchase and Dividend Update
Global Payments’ board of directors has approved a dividend of 1 cent per share, payable Mar 29, 2019 to shareholders of record as of Mar 15, 2019.
The company ramped up its share repurchase program to $750 million.
Balance Sheet Position
Total cash and cash equivalents as of Dec 31, 2018 were $1.2 billion, down 9.4% from $1.3 billion as of Dec 31, 2017.
Long-term debt as of Dec 31, 2018 was $5 billion, up 10% from the level at 2017 end.
Net cash provided by operating activities for 2018 was $1.1 billion, up 116% year over year.
Full-Year Highlights
For 2018, adjusted revenues plus network fees increased 15% to $3.97 billion. Adjusted earnings per share grew $5.19, up 29% year over year.
2019 Outlook
For 2019, the company expects adjusted net revenues plus network fees in the band of $4.43-$4.49 billion. Adjusted EPS is projected in the range of $5.90-$6.10.
Zacks Rank and Performances of Other Industry Players
Global Payments carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Among other players from the finance sector having reported fourth-quarter earnings so far, the bottom-line results of Synchrony Financial (SYF - Free Report) , Intercontinental Exchange Inc. (ICE - Free Report) and MarketAxess Holdings Inc. (MKTX - Free Report) outpaced the respective Zacks Consensus Estimate.
3 Medical Stocks to Buy Now
The greatest discovery in this century of biology is now at the flashpoint between theory and realization. Billions of dollars in research have poured into it. Companies are already generating revenue, and cures for a variety of deadly diseases are in the pipeline.
So are big potential profits for early investors. Zacks has released an updated Special Report that explains this breakthrough and names the best 3 stocks to ride it.
See them today for free >>