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Euronet Worldwide (EEFT)
NASDAQ:EEFT
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Euronet Worldwide
(NASDAQ:EEFT)
73Outperform
Positive Factors
Earnings Performance
Euronet delivered EBITDA/EPS/topline beats with digital transaction growth hitting a fifth consecutive quarter of acceleration.
Growth Opportunities
The opportunity for commercialization of Dandelion in larger corridors offers a meaningful opportunity for growth and margin expansion.
Negative Factors
Business Model Concerns
The longer-run hindrance on shares is the narrative around the terminal value of the ATM business.
Market Risks
The main headline risk and the largest driver of the intra-quarter decline is the narrative around B&M exposure at Ria.
Euronet Worldwide (EEFT) vs. S&P 500 (SPY)
Market Cap
$4.76B
Dividend YieldN/A
Average Volume (3M)484.49K
Price to Earnings (P/E)16.7
Beta (1Y)0.72
Revenue Growth8.18%
EPS Growth17.94%
CountryUS
Employees10,600
SectorTechnology
Sector Strength39
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)6.47
Shares Outstanding43,742,542
10 Day Avg. Volume445,467
30 Day Avg. Volume484,492
Financial Highlights & Ratios
PEG Ratio0.93
Price to Book (P/B)N/A
Price to Sales (P/S)1.18
Price to Cash Flow (P/CF)14.70
P/FCF Ratio28.20
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$129.63Price Target Upside28.09% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering8
Euronet Worldwide Business Overview & Revenue Model
Company DescriptionEuronet Worldwide, Inc. provides payment and transaction processing and distribution solutions to financial institutions, agents, retailers, merchants, content providers, and individual consumers worldwide. The company's Electronic Fund Transfer Processing segment provides electronic payment solutions, including automated teller machine (ATM) cash withdrawal and deposit services, ATM network participation, outsourced ATM and point-of-sale (POS) management solutions, credit and debit card outsourcing, card issuing, and merchant acquiring services. It also offers ATM and POS currency conversion, ATM surcharge, advertising, customer relationship management, mobile top-up, bill payment, fraud management, foreign remittance and cardless payout, banknote recycling, and tax-refund services; and integrated electronic financial transaction software solutions, as well as delivers non-cash products. This segment operates a network of 42,713 ATMs and approximately 438,000 POS terminals. Its epay segment distributes and processed prepaid mobile airtime and other electronic payment products; and provides payment processing services for various prepaid products, cards, and services, as well as vouchers and physical gift fulfillment, and gift card distribution and processing services. This segment operates a network of approximately 775,000 POS terminals. The company's Money Transfer segment offers consumer-to-consumer and account-to-account money transfer, customers bill payment, check cashing, foreign currency exchange, mobile top-up, and cash management and foreign currency risk management services, as well as payment alternatives, such as money orders and prepaid debit cards. This segment operates a network of approximately 510,000 money transfer locations. The company was formerly known as Euronet Services, Inc. and changed its name to Euronet Worldwide, Inc. in August 2001. Euronet Worldwide, Inc. was founded in 1994 and is headquartered in Leawood, Kansas.
How the Company Makes MoneyEuronet Worldwide makes money through several key revenue streams. The Electronic Fund Transfer (EFT) Processing segment generates revenue by providing ATM outsourcing services, network participation, and card issuing services. Fees are collected from transactions conducted at ATMs and for services offered to financial institutions. The epay segment earns money by distributing digital and physical products, like mobile top-ups and gift cards, through a network of retailers. This segment benefits from partnerships with telecom operators and digital content providers. The Money Transfer segment generates revenue from fees charged for money transfer services, both domestic and international, as well as from foreign exchange margins. Euronet's comprehensive network and strategic partnerships with banks, retailers, and telecom operators significantly contribute to its earnings.
Euronet Worldwide Financial Statement Overview
Summary
Euronet Worldwide shows strong financial health with significant revenue growth, improved net profit margin, and effective debt reduction. However, operational cost pressures have affected the EBITDA margin.Income Statement
Euronet Worldwide has demonstrated strong revenue growth with a 8.18% increase in total revenue from 2023 to 2024. The gross profit margin is impressive at 83.76%, highlighting efficient cost management. However, the EBITDA margin has decreased to 5.38%, indicating some operational cost pressures. The EBIT margin is stable at 12.62%, and the net profit margin has improved to 7.67%, suggesting enhanced profitability.78
Positive
Balance Sheet
The company's debt-to-equity ratio has improved significantly from 1.61 in 2023 to 0.77 in 2024, reflecting a reduction in leverage and improved financial stability. The equity ratio is steady at 21.05%, indicating consistent equity funding relative to total assets. Return on equity has increased to 24.90%, showcasing effective use of equity capital to generate profits.70
Positive
Cash Flow
Euronet Worldwide's free cash flow has grown by 12.19% year-over-year, reflecting strong cash generation capabilities. The operating cash flow to net income ratio is robust at 2.39, indicating efficient conversion of income to cash. The free cash flow to net income ratio is high at 2.01, demonstrating strong cash flow relative to profit.82
Very Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 3.99B | 3.69B | 3.36B | 3.00B | 2.48B |
| Gross Profit | ||||
| 3.34B | 1.47B | 1.34B | 1.10B | 906.00M |
| EBIT | ||||
| 503.20M | 432.60M | 385.34M | 222.65M | 153.22M |
| EBITDA | ||||
| 661.20M | 588.90M | 496.04M | 309.63M | 280.25M |
| Net Income Common Stockholders | ||||
| 306.00M | 279.70M | 231.00M | 70.70M | -3.40M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 1.28B | 1.78B | 1.65B | 1.80B | 1.83B |
| Total Assets | ||||
| 5.83B | 5.89B | 5.40B | 4.74B | 4.93B |
| Total Debt | ||||
| 948.40M | 2.01B | 1.77B | 1.59B | 1.61B |
| Net Debt | ||||
| -330.40M | 234.00M | 119.50M | -212.50M | -221.50M |
| Total Liabilities | ||||
| 4.61B | 4.64B | 4.16B | 3.49B | 3.48B |
| Stockholders Equity | ||||
| 1.23B | 1.25B | 1.24B | 1.26B | 1.45B |
| Cash Flow | Free Cash Flow | |||
| 615.60M | 548.70M | 644.03M | 314.37M | 155.88M |
| Operating Cash Flow | ||||
| 732.80M | 643.10M | 748.29M | 406.58M | 253.50M |
| Investing Cash Flow | ||||
| -223.30M | -157.60M | -453.78M | -98.11M | -105.53M |
| Financing Cash Flow | ||||
| -135.70M | -143.20M | -1.15M | -212.24M | 35.40M |
Euronet Worldwide Technical Analysis
Negative
101.20
Price Trends
102.17
Negative
102.51
Negative
101.78
Negative
Market Momentum
2.06
Negative
60.12
Neutral
51.39
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EEFT, the sentiment is Negative. The current price of 101.2 is below the 20-day moving average (MA) of 105.59, below the 50-day MA of 102.17, and below the 200-day MA of 101.78, indicating a bearish trend. The MACD of 2.06 indicates Negative momentum. The RSI at 60.12 is Neutral, neither overbought nor oversold. The STOCH value of 51.39 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for EEFT.
Euronet Worldwide Risk Analysis
Euronet Worldwide disclosed 28 risk factors in its most recent earnings report. Euronet Worldwide reported the most risks in the “Ability to Sell” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Euronet Worldwide Peers Comparison
Overall Rating
UnderperformOutperform
Sector (57)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
84 Outperform | $663.02B | 34.67 | 50.51% | 0.65% | 10.35% | 16.40% | |
76 Outperform | $483.71B | 38.20 | 191.95% | 0.52% | 12.07% | 17.27% | |
73 Outperform | $4.76B | 16.72 | 24.69% | ― | 8.18% | 17.94% | |
73 Outperform | $24.20B | 15.98 | 6.94% | 1.07% | 4.68% | 63.39% | |
69 Neutral | $3.52B | 3.83 | 129.04% | 8.95% | -3.38% | 63.33% | |
57 Neutral | $20.94B | 10.43 | -13.41% | 2.52% | 4.53% | -23.34% | |
51 Neutral | $39.50B | 52.59 | 4.65% | 1.98% | -17.38% | ― |
* Technology Sector Average
Performance Comparison
EEFT
Euronet Worldwide
101.20
-5.49
-5.15%
FIS
Fidelity National Info
74.51
3.96
5.61%
GPN
Global Payments
92.98
-31.79
-25.48%
MA
Mastercard
530.55
63.43
13.58%
V
Visa
339.39
67.42
24.79%
WU
Western Union
10.50
-1.86
-15.05%
Euronet Worldwide Earnings Call Summary
Earnings Call Date: Feb 13, 2025 | % Change Since: 7.18% | Next Earnings Date: Apr 30, 2025
Earnings Call Sentiment Positive
The earnings call reflected a robust financial performance for both the fourth quarter and the full year 2024, marked by significant growth across business segments and strategic expansions into new markets. While there were challenges related to currency fluctuations and a forthcoming tax charge, the company's overall growth trajectory and strong market position suggest a positive outlook.Highlights
Record Fourth Quarter Financial Metrics
Revenue reached $1 billion, operating income was $123 million, and adjusted EBITDA was $166 million. EFT led with double-digit constant currency growth, and Money Transfer and ePay both delivered strong growth metrics.
Strong Full Year 2024 Performance
Consolidated revenue was $4 billion, adjusted operating income was $500 million, and adjusted EBITDA was nearly $700 million. Adjusted EPS grew by 15% year-over-year.
EFT Segment Growth
EFT revenue grew 13%, operating income grew 35%, and adjusted EBITDA grew 19%, driven by growth in merchant services, new market expansion, and cost management.
Digital and Money Transfer Growth
Digital transactions grew 33%, and digital payout grew 31%, representing 54% of total volume. Money Transfer segment outpaced market growth, with 14% growth in US outbound transactions.
Expansion and Strategic Partnerships
Expanded into new markets such as Mexico, the Philippines, and Thailand. Signed partnerships with major players like Ant Financial and Al Hilal Bank.
Lowlights
Impact of Currency Fluctuations
The decline in FX rates negatively impacted adjusted EPS by three to four cents in the fourth quarter.
Tax Charge in Q1 2025
A tax charge of $0.20 to $0.25 per share is expected in Q1 2025 due to state income tax expense related to the repurchase of convertible bonds.
Intra-US Business Decline
Intra-US business declined by 14%, partially offsetting other transaction growth rates.
Company Guidance
During Euronet Worldwide's Fourth Quarter 2024 Earnings Conference Call, the company provided strong guidance for 2025, forecasting adjusted earnings per share (EPS) growth in the range of 12% to 16%. This projection considers a first-quarter tax charge of approximately $0.20 to $0.25 per share related to a one-time repurchase of convertible bonds. For 2024, Euronet reported revenue of $4 billion, operating income of $500 million, and adjusted EBITDA of nearly $700 million, marking a 16% increase in operating income year-over-year. The company highlighted double-digit growth across all segments, with EFT revenue up 13%, ePay revenue increasing by 10% to 12%, and money transfer revenue growing by 9%. Euronet's strategic initiatives, including REN technology, the Dandelion network, and Skylight compliance solutions, are expected to drive continued growth, supported by a robust balance sheet and a $1.9 billion credit facility. The company reinforced its position as a leader in the global payments market, leveraging its diverse revenue streams and extensive network to outpace industry growth rates.Euronet Worldwide Corporate Events
Private Placements and FinancingBusiness Operations and Strategy
Euronet Worldwide Expands Credit Facility for Growth
Positive
Dec 19, 2024
Euronet Worldwide has amended its unsecured revolving credit facility, raising the total amount from $1.25 billion to $1.9 billion and extending the maturity date to December 2029. This adjustment, supported by a syndicate of domestic and international financial institutions, enhances Euronet’s capital flexibility, allowing the company to pursue growth opportunities and deliver increased value to shareholders.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.