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Why Is Euronet Worldwide (EEFT) Up 0.9% Since Last Earnings Report?
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A month has gone by since the last earnings report for Euronet Worldwide (EEFT - Free Report) . Shares have added about 0.9% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Euronet Worldwide due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Euronet’s Q3 Earnings Beat Estimates, Up Y/Y
Euronet Worldwide delivered third-quarter 2018 earnings of $2.16 per share, beating the Zacks Consensus Estimate by 2.8%. Moreover, the bottom line surged 34.2% year over year.
This solid growth was driven by performances by all its three segments, namely, EFT, Money Transfer and epay segments.
The company’s reported net income increased 5% to $1.89 earnings per share in the quarter under review.
Its total revenues were $715 million, up 12.1% from the year-ago quarter. The top line also surpassed the Zacks Consensus Estimate by 0.8%.
Euronet’s total transactions were 1.02 billion, increased 10% year over year, primarily driven by growth in Europe and India through both ATMs and point-of-sale terminals.
Adjusted operating income increased nearly 29% to $150.9 million.
Segment Results
EFT Processing Segment’s total revenues grew 16% (18% on constant currency basis) year over year to $261.7 million on the back of increased transactions and higher number of ATMs. Adjusted EBITDA amounted to $127.1 million, a rise of 25% (26% at constant currency) from the year-ago period. Operating income for the segment was $110.4 million, up 27% year over year (up 28% on constant currency basis).
The epay Segment’s total revenues inched up 1% year over year to $185.4 million (up 3% on constant currency basis). Adjusted EBITDA amounted to $18.3 million, a 1% increase or a 2% increase at constant currency from the year-earlier quarter’s figure. Operating income stood at $16.4 million, up 4% year over year (6% increase on constant currency basis). This segment reported transactions of 284 million, down 3% year over year.
The Money Transfer Segment’s total revenues increased 18% (18% at constant currency) year over year to $268.4 million, backed by 16% increase in transactions. Adjusted EBITDA amounted to $42.2 million, a 33% improvement (34% increase on constant currency basis) from the prior-year quarter. Operating income for this segment totaled $34.3 million, up 41% year over year (42% increase at constant currency). This segment reported total transactions of 27.8 million, up 16% year over year.
Corporate and other Segment reported an expense of $10.2 million for the quarter under review.
4Q18 Guidance
Euronet expects adjusted earnings per share to be nearly $1.27 for the fourth quarter 2018.
Financial Update
Total assets at third-quarter end were $3.4 billion, up 10.2% from the level at year-end 2017.
Cash and cash equivalents improved nearly 38% to $1.1 billion from the figure at year-end 2017.
The company’s total indebtedness decreased 13.6% to $889 million from Jun 30, 2018 level.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates.
VGM Scores
Currently, Euronet Worldwide has an average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. Charting a somewhat similar path, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. It comes with little surprise Euronet Worldwide has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
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Why Is Euronet Worldwide (EEFT) Up 0.9% Since Last Earnings Report?
A month has gone by since the last earnings report for Euronet Worldwide (EEFT - Free Report) . Shares have added about 0.9% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Euronet Worldwide due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Euronet’s Q3 Earnings Beat Estimates, Up Y/Y
Euronet Worldwide delivered third-quarter 2018 earnings of $2.16 per share, beating the Zacks Consensus Estimate by 2.8%. Moreover, the bottom line surged 34.2% year over year.
This solid growth was driven by performances by all its three segments, namely, EFT, Money Transfer and epay segments.
The company’s reported net income increased 5% to $1.89 earnings per share in the quarter under review.
Its total revenues were $715 million, up 12.1% from the year-ago quarter. The top line also surpassed the Zacks Consensus Estimate by 0.8%.
Euronet’s total transactions were 1.02 billion, increased 10% year over year, primarily driven by growth in Europe and India through both ATMs and point-of-sale terminals.
Adjusted operating income increased nearly 29% to $150.9 million.
Segment Results
EFT Processing Segment’s total revenues grew 16% (18% on constant currency basis) year over year to $261.7 million on the back of increased transactions and higher number of ATMs. Adjusted EBITDA amounted to $127.1 million, a rise of 25% (26% at constant currency) from the year-ago period. Operating income for the segment was $110.4 million, up 27% year over year (up 28% on constant currency basis).
The epay Segment’s total revenues inched up 1% year over year to $185.4 million (up 3% on constant currency basis). Adjusted EBITDA amounted to $18.3 million, a 1% increase or a 2% increase at constant currency from the year-earlier quarter’s figure. Operating income stood at $16.4 million, up 4% year over year (6% increase on constant currency basis). This segment reported transactions of 284 million, down 3% year over year.
The Money Transfer Segment’s total revenues increased 18% (18% at constant currency) year over year to $268.4 million, backed by 16% increase in transactions. Adjusted EBITDA amounted to $42.2 million, a 33% improvement (34% increase on constant currency basis) from the prior-year quarter. Operating income for this segment totaled $34.3 million, up 41% year over year (42% increase at constant currency). This segment reported total transactions of 27.8 million, up 16% year over year.
Corporate and other Segment reported an expense of $10.2 million for the quarter under review.
4Q18 Guidance
Euronet expects adjusted earnings per share to be nearly $1.27 for the fourth quarter 2018.
Financial Update
Total assets at third-quarter end were $3.4 billion, up 10.2% from the level at year-end 2017.
Cash and cash equivalents improved nearly 38% to $1.1 billion from the figure at year-end 2017.
The company’s total indebtedness decreased 13.6% to $889 million from Jun 30, 2018 level.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates.
VGM Scores
Currently, Euronet Worldwide has an average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. Charting a somewhat similar path, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. It comes with little surprise Euronet Worldwide has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.