Holding Global Payments Stock? Here's Why it Could Be a Winning Move

Global Payments Inc. GPN is well-poised to grow on the back of rising transaction volumes, strategic partnerships and improving financial performance and shareholder value. However, increasing costs remain a concern.Global Payments — with a market cap of $24.3 billion — is a payment solutions provider based in Atlanta, GA. It provides innovative software and services all around the globe. The payments technology company has a massive network in the Americas, Europe and the Asia-Pacific.Courtesy of solid prospects, this Zacks Rank #3 (Hold) stock is worth holding on to at the moment.Where Do GPN’s Estimates Stand?The Zacks Consensus Estimate for Global Payments’ 2025 earnings is pegged at $12.41 per share, indicating a 7.5% year-over-year rise. The estimate remained stable over the past week. Furthermore, the consensus mark for revenues is pegged at $9.28 billion for 2025, indicating a 1.4% year-over-year rise.Global Payments Inc. Price and EPS Surprise Global Payments Inc. price-eps-surprise | Global Payments Inc. QuoteGPN’s Growth DriversThe continuously increasing demand for digital payment methods is expected to support Global Payments’ transaction volume growth, strengthening its Issuer Solutions business. Adjusted revenues from the segment grew 5.3% and 3.3% in 2023 and 2024, respectively. We expect it to further witness around 3% increase in 2025.To sustain long-term growth, the company strategically forms high-impact partnerships and invests in technology advancements while divesting non-core assets to streamline operations. Its financial position remains robust, with $2.5 billion in cash and cash equivalents as of 2024 end, more than double its short-term debt obligations of $1.1 billion.Global Payments has also demonstrated strong cash flow generation. Operating cash flows increased from $2.2 billion in 2023 to $3.5 billion in 2024, while free cash flows surged nearly 80% over the past year. This financial flexibility allows the company to invest in business expansion and shareholder returns.In 2024, Global Payments repurchased $1.6 billion worth of shares and plans to return $2 billion to shareholders in 2025. With consistent revenue growth, disciplined capital management and a strong balance sheet, GPN remains well-positioned for sustained success in the evolving digital payments landscape.Based on short-term price targets offered by 29 analysts, the Wall Street average price target for Global Payments is at $130.48 per share, suggesting a 31.9% upside from current levels.Key ConcernsThere are a few factors that can hinder the stock’s growth.Despite implementing various cost-control measures, the company's operating expenses are on the rise. Adjusted operating costs rose 5.4% in 2023 and 4.8% in 2024. We expect the metric to stay above $5 billion in 2025. This can dent the company's profit growth levels.Additionally, intensifying competition in the payments industry presents a challenge. Emerging fintech companies with strong growth potential are rapidly gaining market share, increasing the need for innovation and differentiation.However, GPN’s strategic approach — focusing on partnerships, technology investments, and maintaining financial flexibility — positions it for long-term success despite these headwinds.Better-Ranked PlayersSome better-ranked stocks in the broader Business Services space are Coinbase Global, Inc. COIN, Dave Inc. DAVE and PagSeguro Digital Ltd. PAGS, each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.The Zacks Consensus Estimate for Coinbase’s current-year earnings of $7.32 per share has witnessed one upward revision in the past month against no movement in the opposite direction. COIN beat earnings estimates in three of the trailing four quarters and met once, with the average surprise being 46.2%. The consensus estimate for current-year revenues is pegged at $7.79 billion, implying 18.7% year-over-year growth.The Zacks Consensus Estimate for Dave’s current-year earnings indicates a 26.9% year-over-year jump. DAVE’s consensus estimate for current-year revenues implies 22.3% year-over-year growth.The Zacks Consensus Estimate for PagSeguro Digital’s current-year earnings indicates 3.3% year-over-year growth. PAGS beat earnings estimates in each of the trailing four quarters, with the average surprise being 9.3%. The consensus estimate for current-year revenues implies a 3.2% year-over-year increase.Zacks Names #1 Semiconductor StockIt's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Global Payments Inc. (GPN): Free Stock Analysis Report Dave Inc. (DAVE): Free Stock Analysis Report PagSeguro Digital Ltd. (PAGS): Free Stock Analysis Report Coinbase Global, Inc. (COIN): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks