On Dec 18, Zacks Investment Research upgraded
Heartland Payment Systems, Inc
) to a Zacks Rank #2 (Buy).
ALLIANCE DATA (ADS): Free Stock Analysis
AMER EXPRESS CO (AXP): Free Stock Analysis
HEARTLAND PAYMT (HPY): Free Stock Analysis
QIWI PLC-ADR (QIWI): Free Stock Analysis
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Why the Upgrade?
Heartland Payment has been witnessing rising earnings estimates
on the back of strong third-quarter 2013 results and strategic
initiatives to ramp up its growth profile. Moreover, this
financial transaction service provider delivered positive
earnings surprises in 3 of the last 4 quarters with an average
beat of 12.4%. The long-term expected earnings growth rate for
this stock is 14.7%.
Heartland Payment reported third-quarter non-GAAP earnings per
share of 62 cents, surpassing the Zacks Consensus Estimate by 11%
and year ago earnings by 26%.
Earnings were primarily aided by a solid top line, improving 9.5%
year-over-year. The improvement was largely fuelled by solid
growth in card processing, surge in Payroll, solid contribution
from Campus Solutions and a substantial improvement in
Small and mid-sized enterprise (SME) quarterly transaction
processing volume was $19.6 billion, up 3.9% year over year in
the reported quarter.
Heartland Payment spent $6 million to buy back 0.2 million shares
in the third quarter.
Moreover, Heartland Payment expects 2013 net earnings of $2.30
and $2.33 per share on revenues of $600 million and $605 million,
Heartland Payment also inked a deal with the merchant financing
American Express Company
) - American Express Merchant Financing. This deal will make
Heartland the first processor to distribute American Express
The Zacks Consensus Estimate for 2013 moved north by 7.1% to
$2.10 per share, as 3 of 6 estimates were revised higher over the
last 60 days. The current estimate is below the guidance range
provided by Heartland Payment. For 2014 also, 3 of the 6
estimates were revised higher over the same time frame, lifting
the Zacks Consensus Estimate by 2.7% to $2.30 per share.
Other Stocks to Consider
Other financial transaction service providers which look
attractive at current levels include
Alliance Data Systems Corp.
). While Qiwi sports a Zack Rank #1 (Strong Buy), Alliance Data
carries the same Zacks Rank as Heartland Payment.