Boosting its merchant acquiring services,
Total System Services Inc.
) announced a strategic alliance with Zimbabwe-based NMB Bank
Ltd. Through this alliance, Total System plans to use its PRIME 4
card management solution - a multi-resource single technology
platform that offers card solutions to acquirers and issuers.
Accordingly, NMB Bank has agreed to shift its credit card
) to Total System's PRIME 4, in order to enable its cards to
operate on improved security and management. PRIME 4 solutions
are designed in compliance with Service Orientated Architecture
and benefit the users with a web-based and scalable solution. NMB
Bank is now added to the list of more than 130 clients who use
the company's PRIME 4 technology in over 70 countries.
Moreover, Total System's penetration into Zimbabwe also
fortifies its position in Africa, where the top banks of South
Africa, Nigeria and Kenya already stand to benefit from the
merchant acquiring services of the company. Over the last couple
of years, Total Systemhas been making technological advancements
through the PRIME 4 card management solutions, VAR Partner
Connect Program and Mobile App. These technical solutions have
driven the accounts on file of the company and helped it earn
significant contracts and alliances to drive long-term
Total System has been witnessing improvement in its financials
over the past few quarters based on its steady fundamental growth
initiatives. Its risk-free balance sheet, modest cash position
and cash flow generating capability provide viable scope for
efficient capital deployment. However, risks related to operating
leverage and competitive pressure fromarch-rivals such as
Heartland Payment Systems Inc.
) remain eminent.
Based on the pros and cons, the Zacks Consensus Estimate
currently pegs earnings at 33 cents for the fourth quarter of
2012, up about 6% over the prior-year quarter. For 2012, earnings
are projected to increase to $1.29 per share. This reflects an
increase of about 12.5% year over year, which is slightly higher
than the upper end of management's guidance of 10-12% growth for
2012. Based on its influential contracts, management also expects
to achieve the higher-end of its guidance in all growth
Currently, we maintain a long-term Neutral stance on Total
System with a Zacks Rank #3, which implies a short-term Hold
HEARTLAND PAYMT (HPY): Free Stock Analysis
TOTAL SYS SVC (TSS): Free Stock Analysis
VISA INC-A (V): Free Stock Analysis Report
WEX INC (WXS): Free Stock Analysis Report
To read this article on Zacks.com click here.