Shares of FleetCor Hit 52-Week High


On May 29, 2013, the shares of FleetCor Technologies, Inc. (FLT) reached a new 52-week high of $87.45. The momentum was driven by the company’s strong first-quarter earnings.

On May 2, 2013, FleetCor reported first-quarter adjusted earnings of 90 cents, which breezed past the Zacks Consensus Estimate of 77 cents. Results were up 50% year over year from 60 cents earned in the year-ago quarter.

Operating revenues of FleetCor increased 32% year over year to $179.8 million in the reported quarter, surpassing the Zacks Consensus Estimate of $178 billion.

Moreover, FleetCor remaines focussed to grow inorganically.On Apr 30, 2013, the company  announced the acquisition of CardLink, an Aucklang-based company that issues fuel cards and undertakes payment processing.

Further, on Mar 26, 2013, FleetCor announced the acquisition of Fleet Card – a multi-line fuel card – from the custom fleet leasing business of GE Capital Australia. This transaction will mark the company’s foray into the Australian market. Earlier, on Mar 14, FleetCor entered into an agreement to buy the Telenav enterprise business unit from Telenav, Inc. (TNAV) for $10 million.

With respect to earnings trend, FleetCor delivered positive earnings surprise in all last 4 quarter with an average of 10.1%

The valuation of FleetCor’s shares looks little stretched. The shares are trading at a 285.3% premium on price-to-book basis and 48% premium on a forward price-to-earnings basis, compared with the 80% premium on return on equity. Nevertheless, the 1-year return from the stock is 123.4%, much above S&P’s return of 25.1%.  

FleetCor currently carries a Zacks Rank #1 (Strong Buy). Other companies in the miscellaneous financial services industry that are worth considering are Daiwa Securities Group Inc. (DSEEY), Grupo Financiero Banorte, S.A.B. de C.V. (GBOOY) and Euronet Worldwide Inc. (EEFT), all of which carry a Zacks Rank #2 (Buy).

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