That Euronet Worldwide, Inc. 's EEFT stock is an investor favorite is corroborated by its share price movement since its second-quarter earnings release. Shares of the company have gained 12% since Jul 24 owing to an outstanding price performance versus the industry 's decline of 3%.
What's Behind the Price Rally?
The company's EFT Processing segment has been performing significantly well over the past few quarters. This momentum continued into the second quarter of 2018 wherein it contributed to the company's total revenue base of $194.9 million, up 25% year over year. This was primarily backed by increased segmental transactions. Operating income of the EFT Processing segment also stood at $52.9 million. Additionally, the company's Money Transfer Segment drove its total revenue volume of $217.1 million, up 21% year over year, majorly driven by an 18% increase in transactions. Operating income for this segment was $32.7 million, up 31% year over year.
The company's top-line improvement remains quite impressive, having witnessed a CAGR of 12.4% from 2013 to 2017. The same was up 16% for the first half of 2018. Given the company's strong fundamentals, the shares are going to keep its bull run consistent going forward. Moreover, the company's adjusted operating income is substantially growing with a 27% rise registered during second quarter of 2018.
Euronet boasts a solid balance sheet with a favorably low leverage. Its debt to equity ratio stands at 92.5% compared with the industry's 208% average.
Other Noteworthy Factors
Euronet carries a Zacks Rank #2 (Buy). Also, the stock has a commendable Growth Score of B. Back tested results have shown that stocks with a favorable Growth Score of A or B coupled with a bullish Zacks Rank #1 (Strong Buy) or 2 (Buy) offer best investment returns.
Moreover, the company has witnessed its 2018 and 2019 earnings estimates move 2.4% and 2.8% north, respectively, over the past 30 days.
Additionally, the company delivered a positive earnings surprise in the last four quarters with an average beat of 0.38%.
Other Stocks to Consider
Investors looking for some other top-ranked stocks in the same industry might also be interested in On Deck Capital, Inc. ONDK , Ally Financial Inc. ALLY and Athene Holding Ltd. ATH , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here .
On Deck Capital operates as an online platform for small business lenders in the United States, Canada and Australia. It managed to deliver positive results in three of the trailing four quarters with an average beat of 58.3%.
Ally Financial provides various financial products and services for consumers, businesses, automotive dealers and corporate clients in the United States and Canada. It came up with an average four-quarter positive surprise of 13.15%.
Athene, a retirement services company, issues, reinsures and acquires retirement savings products in the United States, the District of Columbia and Germany. It pulled off an average trailing four-quarter earnings surprise of 15.03%.
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