Global Payments Inc. GPN shares are trading lower on Wednesday following the company’s investor conference, in which it guided FY25 EPS growth below estimates.
The company forecasted adjusted EPS growth of approximately 10% for FY25, compared to a Wall Street growth estimate of 12.9%.
The company expects mid-single-digit percentage growth in adjusted net revenue for FY25, while analysts project 6.9% growth.
Apart from this, for 2026-2027, the company anticipates adjusted revenue growth in mid-to high-single-digit and adjusted EPS growth in low-teens.
The company expects operational transformation initiatives to unlock over $500 million in adjusted run-rate operating income benefits by the first half of 2027.
CFO Josh Whipple stated, “We consider 2025 to be a transition year.”
Cameron Bready, chief executive officer said, “In Merchant Solutions, we are fully unifying our business worldwide. We will harmonize products and capabilities, including our POS solutions under a common brand, Genius, and leverage our vast distribution channels to extend them globally.”
“We are prioritizing SMBs to deliver our full suite of differentiated software and commerce enablement solutions they need to run and grow their businesses.”
“In Issuer Solutions, we are capitalizing on meaningful growth opportunities through our cloud modernization and cross-selling initiatives, while also leveraging the strategic value of this business to extend our capabilities across the payments value chain.”
Global Payments plans to return $7.5 billion to shareholders over the next three years. Several analysts cut the price target on the stock.
Seaport analyst Jeff Cantwell downgraded the stock to Neutral from a Buy rating.
The analyst writes that they appreciate the strategic pivot aimed at unifying and streamlining the organization, which is essential for GPN to enhance its competitiveness.
However, despite the clarity provided by the mid-term guidance, GPN’s outlook for both the top and bottom lines fell short of the analyst’s view.
The analyst says that the mid-term guidance indicates softer top-line growth than expected, with just 5% growth in Merchant for ’25.
Beyond ’25, visibility is limited, with projections of mid- to high-single-digit top-line growth and low teens EPS growth, adds the analyst.
BTIG analyst Andrew Harte downgraded Global Payments from Buy to Neutral. Keybanc analyst Alex Markgraff maintained an Overweight and lowered the price target from $145 to $135.
TD Cowen analyst Bryan Bergin maintained Global Payments with a Buy and lowered the price target from $125 to $122.
William Blair analyst Andrew Jeffrey downgraded Global Payments from Outperform to Market Perform. B. Riley Securities analyst Hal Goetsch maintained a Buy and reduced the price target from $204 to $194.
Morgan Stanley analyst James Faucette maintained Global Payments with an Overweight and reduced the price target from $164 to $156. BMO Capital analyst Rufus Hone maintained a Market Perform and lowered the price target from $126 to $122.
Price Action: GPN shares are down 5.96% at $97.62 at the last check Wednesday.
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