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Euronet's (EEFT) Stock Up 8% on Q3 Earnings and Revenue Beat
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Euronet Worldwide, Inc.’s (EEFT - Free Report) shares have gained 8% since third-quarter 2022 earnings were reported on Oct 20, wherein earnings and revenues outpaced the Zacks Consensus Estimate. Results benefited from strong performances by EEFT’s EFT Processing, epay and Money Transfer segments. However, the upside was partly offset by elevated operating expenses.
EEFT reported third-quarter 2022 adjusted earnings of $2.74 per share, beating the Zacks Consensus Estimate by 10.9%. The bottom line soared 55% year over year.
Total revenues advanced 14% year over year or 27% on a constant-currency basis to $931.3 million. The top line outpaced the consensus mark by 1.8%.
Q3 Update
EEFT’s net income of $1.87 per share in the quarter under review was up 36.5% year over year. Operating income surged 47% year over year to $168.5 million.
Total operating expenses escalated 8.6% year over year to $762.8 million in the third quarter due to increased direct operating costs, salaries and benefits, and selling, general and administrative expenses.
Adjusted EBITDA of $211.6 million climbed 36% year over year.
Euronet Worldwide, Inc. Price, Consensus and EPS Surprise
The EFT Processing segment’s revenues of $319.5 million soared 41% year over year (up 62% on a constant currency basis). The figure was higher than the Zacks Consensus Estimate of $318 million.
Adjusted EBITDA surged 63% year over year or 87% on a constant-currency basis to $139.5 million.
The segment reported an operating income of $116.4 million, which soared 84% year over year or 112% on a constant-currency basis. Total transactions climbed 48% year over year to 1,733 million in the third quarter, while the consensus mark for the same stood at 1,683 million.
The segmental performance was driven by better domestic and international withdrawal transactions resulting from the continued rebound in travel. Other factors, such as the buyout of Piraeus Bank's merchant-acquiring business leading to improved point-of-sale revenues and with higher volume in low-priced payment processing transactions within the Asia Pacific also contributed to the strong segmental performance.
The epay segment reported revenues of $248.9 million in the quarter under review, which grew 4% year over year or 18% on a constant-currency basis. The figure was higher than the Zacks Consensus Estimate of $230 million.
Adjusted EBITDA came in at $30.5 million, up 8% year over year or 24% on a constant-currency basis.
Operating income of $29.1 million improved 12% year over year or 29% on a constant-currency basis.
Transactions witnessed a 13% year-over-year increase to 915 million but were lower than the consensus mark of 1,040 million.
The segment was aided by digital branded payments and mobile growth, and an expanding digital distribution channel.
The Money Transfer segment’s total revenues of $364.9 million rose 3% year over year (up 11% on a constant-currency basis) in the third quarter. Revenue growth was led by 14% and 12% in U.S.-outbound transactions and international-originated money transfers, respectively. Yet, the segment’s revenues were lower than the Zacks Consensus Estimate of $369 million.
Adjusted EBITDA of $48.9 million advanced 5% year over year or 19% on a constant-currency basis.
Operating income improved 8% year over year or 23% on a constant-currency basis to $40.7 million. Total transactions of 37.7 million climbed 11% year over year and surpassed the consensus mark of 37.2 million.
Corporate and Other reported expenses of $17.7 million, which escalated 45.1% year over year due to increased short and long-term compensation expenses.
Financial Update (as of Sep 30, 2022)
Euronet exited the third quarter with cash and cash equivalents of $967.1 million, which dropped 23.3% from the 2021-end level. Total assets of $4,827.8 million increased 1.8% from the figure at 2021 end.
Debt obligations, net of current portion, inched up 0.6% from the level as of Dec 31, 2021, to $1,428.5 million.
Equity of $1,027.3 million declined 18.2% from the 2021-end level.
At the third-quarter end, roughly $650 million was available under the revolving credit facilities.
During the first nine months ended Sep 30, 2022, net cash provided by operating activities soared 47.4% from the prior-year comparable period’s level to $448.6 million.
Q4 Outlook
Adjusted EBITDA is estimated within $125-$135 million in the fourth quarter.
2022 Guidance
Earlier, management had expected adjusted earnings per share to remain within the $6.30-$6.40 range this year.
Management expected the epay segment to witness low-double-digit earnings growth in 2022.
Operating margins of the Money Transfer segment were likely to improve in the second half of 2022.
Of the Finance sector players that have reported third-quarter results so far, the bottom-line results of Bank of New York Mellon Corporation (BK - Free Report) , U.S. Bancorp (USB - Free Report) and Nasdaq, Inc. (NDAQ - Free Report) beat the respective Zacks Consensus Estimate.
BNY Mellon’s third-quarter 2022 adjusted earnings of $1.21 per share surpassed the Zacks Consensus Estimate of $1.10. The bottom line represents a rise of 11% from the prior-year quarter’s number. Total revenues grew 6% year over year to $4.28 billion. The top line outpaced the Zacks Consensus Estimate of $4.18 billion. BK’s net interest revenues, on a fully taxable-equivalent (FTE) basis, were $929 million, up 44.3% year over year.
U.S. Bancorp reported third-quarter 2022 earnings per share (excluding merger and integration-related charges) of $1.18, beating the Zacks Consensus Estimate of 1.17. In the prior-year quarter, USB reported earnings of $1.30 per share. Total net revenues were $6.30 billion, up 7.4% year over year. The top line beat the Zacks Consensus Estimate of $6.28 billion. Average earning assets of USB climbed 7.6% year over year.
Nasdaq reported third-quarter 2022 adjusted earnings per share of 68 cents, beating the Zacks Consensus Estimate of 65 cents by 4.6%. The bottom line improved 15% year over year. Revenues of $890 million increased 6% year over year. The top line missed the Zacks Consensus Estimate by 0.1%. NDAQ’s annualized Recurring Revenue (ARR) increased 8% year over year. Annualized SaaS revenues increased 13% and represented 35% of ARR.
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Euronet's (EEFT) Stock Up 8% on Q3 Earnings and Revenue Beat
Euronet Worldwide, Inc.’s (EEFT - Free Report) shares have gained 8% since third-quarter 2022 earnings were reported on Oct 20, wherein earnings and revenues outpaced the Zacks Consensus Estimate. Results benefited from strong performances by EEFT’s EFT Processing, epay and Money Transfer segments. However, the upside was partly offset by elevated operating expenses.
EEFT reported third-quarter 2022 adjusted earnings of $2.74 per share, beating the Zacks Consensus Estimate by 10.9%. The bottom line soared 55% year over year.
Total revenues advanced 14% year over year or 27% on a constant-currency basis to $931.3 million. The top line outpaced the consensus mark by 1.8%.
Q3 Update
EEFT’s net income of $1.87 per share in the quarter under review was up 36.5% year over year. Operating income surged 47% year over year to $168.5 million.
Total operating expenses escalated 8.6% year over year to $762.8 million in the third quarter due to increased direct operating costs, salaries and benefits, and selling, general and administrative expenses.
Adjusted EBITDA of $211.6 million climbed 36% year over year.
Euronet Worldwide, Inc. Price, Consensus and EPS Surprise
Euronet Worldwide, Inc. price-consensus-eps-surprise-chart | Euronet Worldwide, Inc. Quote
Segmental Performances
The EFT Processing segment’s revenues of $319.5 million soared 41% year over year (up 62% on a constant currency basis). The figure was higher than the Zacks Consensus Estimate of $318 million.
Adjusted EBITDA surged 63% year over year or 87% on a constant-currency basis to $139.5 million.
The segment reported an operating income of $116.4 million, which soared 84% year over year or 112% on a constant-currency basis. Total transactions climbed 48% year over year to 1,733 million in the third quarter, while the consensus mark for the same stood at 1,683 million.
The segmental performance was driven by better domestic and international withdrawal transactions resulting from the continued rebound in travel. Other factors, such as the buyout of Piraeus Bank's merchant-acquiring business leading to improved point-of-sale revenues and with higher volume in low-priced payment processing transactions within the Asia Pacific also contributed to the strong segmental performance.
The epay segment reported revenues of $248.9 million in the quarter under review, which grew 4% year over year or 18% on a constant-currency basis. The figure was higher than the Zacks Consensus Estimate of $230 million.
Adjusted EBITDA came in at $30.5 million, up 8% year over year or 24% on a constant-currency basis.
Operating income of $29.1 million improved 12% year over year or 29% on a constant-currency basis.
Transactions witnessed a 13% year-over-year increase to 915 million but were lower than the consensus mark of 1,040 million.
The segment was aided by digital branded payments and mobile growth, and an expanding digital distribution channel.
The Money Transfer segment’s total revenues of $364.9 million rose 3% year over year (up 11% on a constant-currency basis) in the third quarter. Revenue growth was led by 14% and 12% in U.S.-outbound transactions and international-originated money transfers, respectively. Yet, the segment’s revenues were lower than the Zacks Consensus Estimate of $369 million.
Adjusted EBITDA of $48.9 million advanced 5% year over year or 19% on a constant-currency basis.
Operating income improved 8% year over year or 23% on a constant-currency basis to $40.7 million. Total transactions of 37.7 million climbed 11% year over year and surpassed the consensus mark of 37.2 million.
Corporate and Other reported expenses of $17.7 million, which escalated 45.1% year over year due to increased short and long-term compensation expenses.
Financial Update (as of Sep 30, 2022)
Euronet exited the third quarter with cash and cash equivalents of $967.1 million, which dropped 23.3% from the 2021-end level. Total assets of $4,827.8 million increased 1.8% from the figure at 2021 end.
Debt obligations, net of current portion, inched up 0.6% from the level as of Dec 31, 2021, to $1,428.5 million.
Equity of $1,027.3 million declined 18.2% from the 2021-end level.
At the third-quarter end, roughly $650 million was available under the revolving credit facilities.
During the first nine months ended Sep 30, 2022, net cash provided by operating activities soared 47.4% from the prior-year comparable period’s level to $448.6 million.
Q4 Outlook
Adjusted EBITDA is estimated within $125-$135 million in the fourth quarter.
2022 Guidance
Earlier, management had expected adjusted earnings per share to remain within the $6.30-$6.40 range this year.
Management expected the epay segment to witness low-double-digit earnings growth in 2022.
Operating margins of the Money Transfer segment were likely to improve in the second half of 2022.
Zacks Rank
Euronet currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Other Finance Sector Releases
Of the Finance sector players that have reported third-quarter results so far, the bottom-line results of Bank of New York Mellon Corporation (BK - Free Report) , U.S. Bancorp (USB - Free Report) and Nasdaq, Inc. (NDAQ - Free Report) beat the respective Zacks Consensus Estimate.
BNY Mellon’s third-quarter 2022 adjusted earnings of $1.21 per share surpassed the Zacks Consensus Estimate of $1.10. The bottom line represents a rise of 11% from the prior-year quarter’s number. Total revenues grew 6% year over year to $4.28 billion. The top line outpaced the Zacks Consensus Estimate of $4.18 billion. BK’s net interest revenues, on a fully taxable-equivalent (FTE) basis, were $929 million, up 44.3% year over year.
U.S. Bancorp reported third-quarter 2022 earnings per share (excluding merger and integration-related charges) of $1.18, beating the Zacks Consensus Estimate of 1.17. In the prior-year quarter, USB reported earnings of $1.30 per share. Total net revenues were $6.30 billion, up 7.4% year over year. The top line beat the Zacks Consensus Estimate of $6.28 billion. Average earning assets of USB climbed 7.6% year over year.
Nasdaq reported third-quarter 2022 adjusted earnings per share of 68 cents, beating the Zacks Consensus Estimate of 65 cents by 4.6%. The bottom line improved 15% year over year. Revenues of $890 million increased 6% year over year. The top line missed the Zacks Consensus Estimate by 0.1%. NDAQ’s annualized Recurring Revenue (ARR) increased 8% year over year. Annualized SaaS revenues increased 13% and represented 35% of ARR.