On Mar 25, 2013, shares of
) hit a 52-week high of $76.88. The company reported
fourth-quarter results with a positive earnings surprise of 10%.
FleetCor delivered positive earnings surprise in 3 out of 4
quarters in 2012 with an average beat of 10%.
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On Feb 7, 2013, FleetCor reported its fourth-quarter adjusted
earnings of 77 cents which breezed past the Zacks Consensus
Estimate by 10% and year ago earnings by 51%.
FleetCor's top line grew 45% year over year to $203 million,
driven by solid contribution from international and North America
segment as well as increase in merchant commissions. It surpassed
the Zacks Consensus Estimate of $179 million.
FleetCor has been continuously working toward developing its
businesses globally. Earlier this month FleetCor entered into an
agreement to buy the Telenav enterprise business unit from
). Previously, in 2012 FleetCor successfully acquired CTF
technologies Inc. (CTF) - a Brazilian fuel payment processor.
Other notable acquisitions include a Fuel card company in Russia
and the Mexican assets of Tebca and Servitebica - the
subsidiaries of NovoPayment, a prepaid card program provider.
Additionally, the company also commenced its Global FleetNet
(GFN) platform in Asia for Shell in 2012. With $1 billion
liquidity to support such transactions the company expects to
engage in more business development activities, going forward.
Further the company has been gaining investor confidence by
engaging in considerable share buybacks. In Dec 2012, the company
repurchased nearly 3.85 million stocks under a share repurchase
agreement with its shareholders associated with Summit Partners
and Bain Capital.
However, valuation looks stretched for FleetCor. The shares are
trading at a 55.1% premium to the peer group average on a forward
price-to-earnings basis and at a 199.1% premium to the peer group
average on a price-to-book basis. The return on equity is 24.9%
above the peer group average. Nevertheless, the 1-year return
from the stock is 91.46%, much above the S&P 500's return of
We believe FleetCor's focus on business development to bolster
future earnings. FleetCor expects to deliver $3.61 to $3.69 per
share in earnings on revenue of $790-$810 million in 2013. The
acquisitions and share buybacks are expected to help FleetCor
achieve its expectation and improve its operational results going
forward. The overall long-term expected earnings growth rate for
this stock is 16.4%.
FleetCor currently carries a Zacks Rank #2 (Buy). Among others
from the industry,
Euronet Worldwide Inc.
) carry a favorable Zacks Rank #1 (Strong Buy) and are worth