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Here's Why Investors Should Retain Global Payments Stock for Now
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Key Takeaways
GPN plans to divest Issuer Solutions and acquire Worldpay to simplify operations and expand global reach.
Operating cash flow rose from $2.2B in 2023 to $3.5B in 2024, with $555.1M generated in 1Q25.
GPN trades at a forward P/E of 6.61X, well below the industry average of 22.84X.
Global Payments Inc. (GPN - Free Report) is a global payments technology company that provides innovative software and services. It is well-positioned to grow on the back of rising transactions, acquisitions and partnerships, and strong financials. Shares of GPN have fallen 26.9% in the year-to-date period against the industry’s growth of 5%.
Headquartered in Atlanta, GA, GPN holds a market capitalization of $20 billion. The company offers a wide range of solutions that enable its customers to operate their businesses efficiently across a variety of channels around the world. Its forward 12-month P/E ratio of 6.61X is lower than the industry average of 22.84X.
Courtesy of solid prospects, GPN currently carries a Zacks Rank #3 (Hold).
Where Do Estimates for GPN Stand?
The Zacks Consensus Estimate for Global Payments’ 2025 earnings is pegged at $11.12 per share and has witnessed four upward estimate revisions in the past 60 days against none in the opposite direction. Furthermore, the consensus mark for revenues is pegged at $9.3 billion for 2025, indicating 1.6% year-over-year growth. It beat earnings estimates in two of the past four quarters and missed twice.
GPN’s Merchant Solutions division continues to benefit from its innovative payment facilitation model, along with the growing demand for its point-of-sale solutions. The segment’s adjusted revenues grew 8.7% year over year in 2024 and 0.5% year over year in the first quarter of 2025. The Issuer Solutions segment reported adjusted revenue growth of 2.6% year over year in first-quarter 2025.
To sustain long-term growth, the company focuses on building strong partnerships that make a real impact and invests in cutting-edge technologies. At the same time, GPN divests from non-core assets to make operations more efficient.
GPN plans to divest Issuer Solutions and acquire Worldpay. This move could help the company streamline and simplify its operations, paving the way for long-term growth and value creation. Worldpay will allow the company to expand its global reach, broaden its product base and enhance its market approach.
Global Payments has also demonstrated strong cash flow generation. Operating cash flow increased from $2.2 billion in 2023 to $3.5 billion in 2024. It generated operating cash flow of $555.1 million in the first quarter of 2025, which rose 4.6% year over year. This financial flexibility allows the company to invest in business expansion and shareholder returns.
Its financial position remains robust, with $2.9 billion in cash and cash equivalents as of March 31, 2025, more than double its short-term debt obligations of $1.2 billion. In the first quarter of 2025, Global Payments repurchased $446.3 million worth of shares. With consistent revenue growth, disciplined capital management and a strong balance sheet, the company remains well-positioned for sustained success in the evolving digital payments landscape.
Risks for GPN Stock
There are some factors, however, that investors should keep a careful eye on.
Despite implementing multiple cost control measures, the company's operating expenses are on the rise. In 2023 and 2024, its adjusted operating costs rose by 5.4% and 8.2%, year over year, respectively. However, in the first quarter of 2025, its adjusted operating cost witnessed a decline of 0.3%. GPN will continue to pursue significant investments in capital expenditures, which are projected to be around $780 million in 2025. Our model suggests total operating expenses to rise 1.3% year over year in 2025.
The growing competition in the payment market is a significant challenge for the company. With new payment firms rapidly securing market share, potentially pressuring pricing dynamics. This intensified competition could affect Global Payments’ profitability as it works to keep its pricing competitive in the market.
The company’s ROE of 12.9% falls significantly below the industry’s average of 48.5%, indicating a potential inefficiency in utilizing shareholders' funds to generate returns.
The Zacks Consensus Estimate for OppFi’s current-year earnings of $1.23 per share has witnessed two upward revisions in the past 60 days against no movement in the opposite direction. OppFi beat earnings estimates in each of the trailing four quarters, the average surprise being 59.5%. The consensus estimate for current-year revenues is pegged at $578.4 million, implying 10% year-over-year growth.
The Zacks Consensus Estimate for Green Dot’s current-year earnings of $1.22 per share has witnessed two upward revisions in the past 60 days against no movement in the opposite direction. Green Dot beat earnings estimates in two of the trailing four quarters and missed twice, the average surprise being 5.6%. The consensus estimate for current-year revenues is pegged at $2.1 billion, calling for a 20.2% year-over-year increase.
The Zacks Consensus Estimate for Sezzle’s current-year earnings of $3.26 per share has witnessed two upward revisions in the past 60 days against no movement in the opposite direction. Sezzle beat earnings estimates in each of the trailing four quarters, the average surprise being 159.9%. The consensus estimate for current-year revenues is pegged at $441.8 million, suggesting 62.9% year-over-year growth.
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Here's Why Investors Should Retain Global Payments Stock for Now
Key Takeaways
Global Payments Inc. (GPN - Free Report) is a global payments technology company that provides innovative software and services. It is well-positioned to grow on the back of rising transactions, acquisitions and partnerships, and strong financials. Shares of GPN have fallen 26.9% in the year-to-date period against the industry’s growth of 5%.
Headquartered in Atlanta, GA, GPN holds a market capitalization of $20 billion. The company offers a wide range of solutions that enable its customers to operate their businesses efficiently across a variety of channels around the world. Its forward 12-month P/E ratio of 6.61X is lower than the industry average of 22.84X.
Courtesy of solid prospects, GPN currently carries a Zacks Rank #3 (Hold).
Where Do Estimates for GPN Stand?
The Zacks Consensus Estimate for Global Payments’ 2025 earnings is pegged at $11.12 per share and has witnessed four upward estimate revisions in the past 60 days against none in the opposite direction. Furthermore, the consensus mark for revenues is pegged at $9.3 billion for 2025, indicating 1.6% year-over-year growth. It beat earnings estimates in two of the past four quarters and missed twice.
Global Payments Inc. Price and EPS Surprise
Global Payments Inc. price-eps-surprise | Global Payments Inc. Quote
GPN’s Growth Drivers
GPN’s Merchant Solutions division continues to benefit from its innovative payment facilitation model, along with the growing demand for its point-of-sale solutions. The segment’s adjusted revenues grew 8.7% year over year in 2024 and 0.5% year over year in the first quarter of 2025. The Issuer Solutions segment reported adjusted revenue growth of 2.6% year over year in first-quarter 2025.
To sustain long-term growth, the company focuses on building strong partnerships that make a real impact and invests in cutting-edge technologies. At the same time, GPN divests from non-core assets to make operations more efficient.
GPN plans to divest Issuer Solutions and acquire Worldpay. This move could help the company streamline and simplify its operations, paving the way for long-term growth and value creation. Worldpay will allow the company to expand its global reach, broaden its product base and enhance its market approach.
Global Payments has also demonstrated strong cash flow generation. Operating cash flow increased from $2.2 billion in 2023 to $3.5 billion in 2024. It generated operating cash flow of $555.1 million in the first quarter of 2025, which rose 4.6% year over year. This financial flexibility allows the company to invest in business expansion and shareholder returns.
Its financial position remains robust, with $2.9 billion in cash and cash equivalents as of March 31, 2025, more than double its short-term debt obligations of $1.2 billion. In the first quarter of 2025, Global Payments repurchased $446.3 million worth of shares. With consistent revenue growth, disciplined capital management and a strong balance sheet, the company remains well-positioned for sustained success in the evolving digital payments landscape.
Risks for GPN Stock
There are some factors, however, that investors should keep a careful eye on.
Despite implementing multiple cost control measures, the company's operating expenses are on the rise. In 2023 and 2024, its adjusted operating costs rose by 5.4% and 8.2%, year over year, respectively. However, in the first quarter of 2025, its adjusted operating cost witnessed a decline of 0.3%. GPN will continue to pursue significant investments in capital expenditures, which are projected to be around $780 million in 2025. Our model suggests total operating expenses to rise 1.3% year over year in 2025.
The growing competition in the payment market is a significant challenge for the company. With new payment firms rapidly securing market share, potentially pressuring pricing dynamics. This intensified competition could affect Global Payments’ profitability as it works to keep its pricing competitive in the market.
The company’s ROE of 12.9% falls significantly below the industry’s average of 48.5%, indicating a potential inefficiency in utilizing shareholders' funds to generate returns.
Key Picks
Some better-ranked stocks in the business services space are OppFi Inc. (OPFI - Free Report) , Green Dot Corporation (GDOT - Free Report) and Sezzle Inc. (SEZL - Free Report) , each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for OppFi’s current-year earnings of $1.23 per share has witnessed two upward revisions in the past 60 days against no movement in the opposite direction. OppFi beat earnings estimates in each of the trailing four quarters, the average surprise being 59.5%. The consensus estimate for current-year revenues is pegged at $578.4 million, implying 10% year-over-year growth.
The Zacks Consensus Estimate for Green Dot’s current-year earnings of $1.22 per share has witnessed two upward revisions in the past 60 days against no movement in the opposite direction. Green Dot beat earnings estimates in two of the trailing four quarters and missed twice, the average surprise being 5.6%. The consensus estimate for current-year revenues is pegged at $2.1 billion, calling for a 20.2% year-over-year increase.
The Zacks Consensus Estimate for Sezzle’s current-year earnings of $3.26 per share has witnessed two upward revisions in the past 60 days against no movement in the opposite direction. Sezzle beat earnings estimates in each of the trailing four quarters, the average surprise being 159.9%. The consensus estimate for current-year revenues is pegged at $441.8 million, suggesting 62.9% year-over-year growth.