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Here's Why Euronet (EEFT) Stock Appears to be a Lucrative Bet
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Euronet Worldwide, Inc. (EEFT - Free Report) is currently being aided by strong segmental performances, continuous pursuit of buyouts and a strong financial position.
Zacks Rank & Price Rally
Euronet currently carries a Zacks Rank #2 (Buy).
The stock has gained 9.3% year to date against the industry’s 0.2% decline. The Zacks Finance sector has declined 3.6% but the S&P 500 composite inched up 0.5% in the said time frame.
Image Source: Zacks Investment Research
Favorable Style Score
EEFT carries an impressive Value Score of B. Value Score helps identify undervalued stocks. The back-tested results show that stocks with a Value Score of A or B in combination with a Zacks Rank #1 (Strong Buy) or 2 are the best investment bets.
Robust Growth Prospects
The Zacks Consensus Estimate for Euronet’s 2023 earnings is pegged at $7.52 per share, indicating a 15.5% increase from the year-ago reported figure. The same for revenues stands at $3.7 billion, implying 9.2% growth from the prior-year number.
The Zacks Consensus Estimate for 2024 earnings is pegged at $8.68 per share, suggesting 15.4% growth from the 2023 estimate. The same for revenues stands at $4.1 billion, which indicates a rise of 10.5% from the 2023 estimate.
Decent Earnings Surprise History
The bottom line of EEFT outpaced estimates in three of the trailing four quarters and missed the mark once, the average being 7.12%.
Solid Return on Equity
Euronet’s efficiency in utilizing shareholders’ funds can be substantiated by its return on equity of 26.3% as of Dec 31, 2022, which remains higher than the industry’s average of 19.6%.
Growth Drivers
Solid contributions from the EFT Processing, epay and Money Transfer segments contribute to the revenue growth of Euronet. Barring 2020, its revenues have grown consistently since 2009.
The EFT Processing segment benefits from improved domestic and international withdrawal transactions stemming from the rebound in travel and higher POS processing revenue. Consistent expansion of digital branded payments and mobile growth aid growth of the epay segment, while an increase in U.S.-outbound transactions and international-originated money transfers drives the Money Transfer segment’s performance.
Euronet frequently resorts to an inorganic growth strategy through which it aims to develop new products and services, boost revenues as well as expand its geographical presence. In 2022, EEFT spent $343 million on acquisitions. The purchase of the Merchant Acquiring Business of Piraeus Bank contributed $88.8 million to EEFT’s overall revenues last year.
Also, the growing popularity of contactless payments — a trend that shows no mood of slowing down — provides the perfect ground for Euronet to bank on its innovative payment solutions.
EEFT comprises sound cash reserves and robust cash-generating abilities through which it can pursue uninterrupted business investments. As of Dec 31, 2022, its cash balance of $1,131.2 million remains sufficient to service its meager short-term debt of $3.1 million. Also, Euronet generated operating cash flows of $748.3 million in 2022, which soared 84% year over year.
FS Bancorp’s earnings surpassed estimates in three of the trailing four quarters and missed the mark once, the average being 5.34%. The Zacks Consensus Estimate for FSBW’s 2023 earnings suggests an improvement of 29.2%, while the same for revenues suggests growth of 21% from the corresponding year-ago reported figures. The consensus mark for FSBW’s 2023 earnings has moved 10.6% north in the past 30 days.
The bottom line of OceanFirst Financial beat estimates in each of the trailing four quarters, the average surprise being 7.32%. The Zacks Consensus Estimate for OCFC’s 2023 earnings suggests an improvement of 18%, while the same for revenues suggests growth of 10.6% from the corresponding year-ago reported figures. The consensus mark for OCFC’s 2023 earnings has moved 2.2% north in the past 30 days.
Private Bancorp of America’s earnings outpaced estimates in three of the last four quarters and missed the mark once, the average surprise being 13.58%. The Zacks Consensus Estimate for PBAM’s 2023 earnings suggests an improvement of 8.3%, while the same for revenues suggests growth of 11.5% from the corresponding year-ago reported figures. The consensus mark for PBAM’s 2023 earnings has moved 7.6% north in the past 30 days.
Shares of FS Bancorp, OceanFirst Financial and Private Bancorp of America have lost 10.5%, 8.7% and 7.1%, respectively, year to date.
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Here's Why Euronet (EEFT) Stock Appears to be a Lucrative Bet
Euronet Worldwide, Inc. (EEFT - Free Report) is currently being aided by strong segmental performances, continuous pursuit of buyouts and a strong financial position.
Zacks Rank & Price Rally
Euronet currently carries a Zacks Rank #2 (Buy).
The stock has gained 9.3% year to date against the industry’s 0.2% decline. The Zacks Finance sector has declined 3.6% but the S&P 500 composite inched up 0.5% in the said time frame.
Image Source: Zacks Investment Research
Favorable Style Score
EEFT carries an impressive Value Score of B. Value Score helps identify undervalued stocks. The back-tested results show that stocks with a Value Score of A or B in combination with a Zacks Rank #1 (Strong Buy) or 2 are the best investment bets.
Robust Growth Prospects
The Zacks Consensus Estimate for Euronet’s 2023 earnings is pegged at $7.52 per share, indicating a 15.5% increase from the year-ago reported figure. The same for revenues stands at $3.7 billion, implying 9.2% growth from the prior-year number.
The Zacks Consensus Estimate for 2024 earnings is pegged at $8.68 per share, suggesting 15.4% growth from the 2023 estimate. The same for revenues stands at $4.1 billion, which indicates a rise of 10.5% from the 2023 estimate.
Decent Earnings Surprise History
The bottom line of EEFT outpaced estimates in three of the trailing four quarters and missed the mark once, the average being 7.12%.
Solid Return on Equity
Euronet’s efficiency in utilizing shareholders’ funds can be substantiated by its return on equity of 26.3% as of Dec 31, 2022, which remains higher than the industry’s average of 19.6%.
Growth Drivers
Solid contributions from the EFT Processing, epay and Money Transfer segments contribute to the revenue growth of Euronet. Barring 2020, its revenues have grown consistently since 2009.
The EFT Processing segment benefits from improved domestic and international withdrawal transactions stemming from the rebound in travel and higher POS processing revenue. Consistent expansion of digital branded payments and mobile growth aid growth of the epay segment, while an increase in U.S.-outbound transactions and international-originated money transfers drives the Money Transfer segment’s performance.
Euronet frequently resorts to an inorganic growth strategy through which it aims to develop new products and services, boost revenues as well as expand its geographical presence. In 2022, EEFT spent $343 million on acquisitions. The purchase of the Merchant Acquiring Business of Piraeus Bank contributed $88.8 million to EEFT’s overall revenues last year.
Also, the growing popularity of contactless payments — a trend that shows no mood of slowing down — provides the perfect ground for Euronet to bank on its innovative payment solutions.
EEFT comprises sound cash reserves and robust cash-generating abilities through which it can pursue uninterrupted business investments. As of Dec 31, 2022, its cash balance of $1,131.2 million remains sufficient to service its meager short-term debt of $3.1 million. Also, Euronet generated operating cash flows of $748.3 million in 2022, which soared 84% year over year.
Other Stocks to Consider
Some other top-ranked stocks in the Finance space are FS Bancorp, Inc. (FSBW - Free Report) , OceanFirst Financial Corp. (OCFC - Free Report) and Private Bancorp of America, Inc. (PBAM - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
FS Bancorp’s earnings surpassed estimates in three of the trailing four quarters and missed the mark once, the average being 5.34%. The Zacks Consensus Estimate for FSBW’s 2023 earnings suggests an improvement of 29.2%, while the same for revenues suggests growth of 21% from the corresponding year-ago reported figures. The consensus mark for FSBW’s 2023 earnings has moved 10.6% north in the past 30 days.
The bottom line of OceanFirst Financial beat estimates in each of the trailing four quarters, the average surprise being 7.32%. The Zacks Consensus Estimate for OCFC’s 2023 earnings suggests an improvement of 18%, while the same for revenues suggests growth of 10.6% from the corresponding year-ago reported figures. The consensus mark for OCFC’s 2023 earnings has moved 2.2% north in the past 30 days.
Private Bancorp of America’s earnings outpaced estimates in three of the last four quarters and missed the mark once, the average surprise being 13.58%. The Zacks Consensus Estimate for PBAM’s 2023 earnings suggests an improvement of 8.3%, while the same for revenues suggests growth of 11.5% from the corresponding year-ago reported figures. The consensus mark for PBAM’s 2023 earnings has moved 7.6% north in the past 30 days.
Shares of FS Bancorp, OceanFirst Financial and Private Bancorp of America have lost 10.5%, 8.7% and 7.1%, respectively, year to date.