We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Shift4 Payments, Inc. (FOUR) Soars to 52-Week High, Time to Cash Out?
Read MoreHide Full Article
Shares of Shift4 Payments (FOUR - Free Report) have been strong performers lately, with the stock up 10.1% over the past month. The stock hit a new 52-week high of $76.51 in the previous session. Shift4 Payments has gained 26.6% since the start of the year compared to the 21.1% move for the Zacks Business Services sector and the 20.6% return for the Zacks Financial Transaction Services industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on November 8, 2023, Shift4 Payments reported EPS of $0.82 versus consensus estimate of $0.7 while it missed the consensus revenue estimate by 2.88%.
For the current fiscal year, Shift4 Payments is expected to post earnings of $2.92 per share on $951.51 million in revenues. This represents a 110.07% change in EPS on a 30.79% change in revenues. For the next fiscal year, the company is expected to earn $3.81 per share on $1.3 billion in revenues. This represents a year-over-year change of 30.42% and 36.89%, respectively.
Valuation Metrics
Shift4 Payments may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
Shift4 Payments has a Value Score of D. The stock's Growth and Momentum Scores are A and D, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 24.3X current fiscal year EPS estimates, which is a premium to the peer industry average of 15.2X. On a trailing cash flow basis, the stock currently trades at 27.9X versus its peer group's average of 10.4X. Additionally, the stock has a PEG ratio of 0.47. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, Shift4 Payments currently has a Zacks Rank of #1 (Strong Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Shift4 Payments fits the bill. Thus, it seems as though Shift4 Payments shares could still be poised for more gains ahead.
How Does FOUR Stack Up to the Competition?
Shares of FOUR have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is OppFi Inc. (OPFI - Free Report) . OPFI has a Zacks Rank of # 1 (Strong Buy) and a Value Score of A, a Growth Score of A, and a Momentum Score of D.
Earnings were strong last quarter. OppFi Inc. beat our consensus estimate by 300%, and for the current fiscal year, OPFI is expected to post earnings of $0.71 per share on revenue of $509.52 million.
Shares of OppFi Inc. have gained 44.4% over the past month, and currently trade at a forward P/E of 9.21X and a P/CF of 22.66X.
The Financial Transaction Services industry may rank in the bottom 53% of all the industries we have in our universe, but there still looks like there are some nice tailwinds for FOUR and OPFI, even beyond their own solid fundamental situation.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Shift4 Payments, Inc. (FOUR) Soars to 52-Week High, Time to Cash Out?
Shares of Shift4 Payments (FOUR - Free Report) have been strong performers lately, with the stock up 10.1% over the past month. The stock hit a new 52-week high of $76.51 in the previous session. Shift4 Payments has gained 26.6% since the start of the year compared to the 21.1% move for the Zacks Business Services sector and the 20.6% return for the Zacks Financial Transaction Services industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on November 8, 2023, Shift4 Payments reported EPS of $0.82 versus consensus estimate of $0.7 while it missed the consensus revenue estimate by 2.88%.
For the current fiscal year, Shift4 Payments is expected to post earnings of $2.92 per share on $951.51 million in revenues. This represents a 110.07% change in EPS on a 30.79% change in revenues. For the next fiscal year, the company is expected to earn $3.81 per share on $1.3 billion in revenues. This represents a year-over-year change of 30.42% and 36.89%, respectively.
Valuation Metrics
Shift4 Payments may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
Shift4 Payments has a Value Score of D. The stock's Growth and Momentum Scores are A and D, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 24.3X current fiscal year EPS estimates, which is a premium to the peer industry average of 15.2X. On a trailing cash flow basis, the stock currently trades at 27.9X versus its peer group's average of 10.4X. Additionally, the stock has a PEG ratio of 0.47. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, Shift4 Payments currently has a Zacks Rank of #1 (Strong Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Shift4 Payments fits the bill. Thus, it seems as though Shift4 Payments shares could still be poised for more gains ahead.
How Does FOUR Stack Up to the Competition?
Shares of FOUR have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is OppFi Inc. (OPFI - Free Report) . OPFI has a Zacks Rank of # 1 (Strong Buy) and a Value Score of A, a Growth Score of A, and a Momentum Score of D.
Earnings were strong last quarter. OppFi Inc. beat our consensus estimate by 300%, and for the current fiscal year, OPFI is expected to post earnings of $0.71 per share on revenue of $509.52 million.
Shares of OppFi Inc. have gained 44.4% over the past month, and currently trade at a forward P/E of 9.21X and a P/CF of 22.66X.
The Financial Transaction Services industry may rank in the bottom 53% of all the industries we have in our universe, but there still looks like there are some nice tailwinds for FOUR and OPFI, even beyond their own solid fundamental situation.