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Euronet's (EEFT) Q3 Earnings Beat, Revenues Miss Estimates

Zacks Equity Research

Euronet Worldwide, Inc. EEFT delivered third-quarter 2019 earnings of $2.84 per share, beating the Zacks Consensus Estimate by 1.4%.

Moreover, the bottom line improved 31.5% year over year.  This upside can mainly be attributed to higher revenue contribution by all segments.  

The company’s reported net income also surged 30.2% to $2.46 earnings per share in the quarter under review.

Further, its total revenues were $787 million, up 10.1% from the year-ago quarter. Meanwhile, the top line missed the Zacks Consensus Estimate by 4%.

Euronet’s total transactions were 1.23 million, having increased 21% year over year.

Additionally, operating income rose nearly 29% to $194 million in the quarter under review.

Euronet Worldwide, Inc. Price, Consensus and EPS Surprise

Euronet Worldwide, Inc. Price, Consensus and EPS Surprise

Euronet Worldwide, Inc. price-consensus-eps-surprise-chart | Euronet Worldwide, Inc. Quote

Segmental Results

Segmental Update


EFT Processing Segment’s total revenues grew 21% (26% in constant currency) year over year to $261.7 million on the back of higher transactions and a rise in operated ATMs. Adjusted EBITDA amounted to $168.9 million, up 33% (38% at cc) from the year-ago period. Operating income for the segment was $150.9 million, up 37% year over year (up 42% on constant currency basis).

The epay Segment’s total revenues increased 3% year over year to $185.4 million (7% up on constant currency basis). Adjusted EBITDA amounted to $21.7 million, up 19% improvement from the year-earlier figure (23% up on constant currency basis). Operating income stands at $20.1 million, up 23% year over year (27% on constant currency basis). This segment reported transactions of 389 million, up 40% year over year.

The Money Transfer Segment’s total revenues climbed 5% (7% at cc) year over year to $280.8 million, backed by 5% higher transactions. Adjusted EBITDA amounted to $43.7 million, reflecting a 4% improvement (6% increase at cc) from the prior-year quarter. Operating income for this segment totaled $35.6 million, up 6% in constant currency. This segment reported total transactions of 29.3 million, up 5% year over year.

Corporate and other Segment incurred an expense of $12.6 million in the reported quarter, up 24% year over year.

Q4 Guidance

Euronet expects adjusted earnings per share for the fourth quarter to be nearly $1.61 (assuming forex to be stable).

Financial Update

Total assets at third-quarter end were $4.3 billion, up 30% from the level at 2018 end.

Cash and cash equivalents improved nearly 64.2% to $1.7 billion from the figure at 2018 end.

The company’s total indebtedness declined 21.4% to $1.1 billion year over year. This decrease was owing to the impact of favorable foreign currency translation on its Euro-dominated debt.

Zacks Rank

Euronet carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Peer Releases From Finance Sector

Global Payments Inc. GPN is slated to announce third-quarter earnings on Oct 31. The consensus estimate for earnings is pegged at $1.67, implying growth from $1.44 reported in the prior-year quarter. The stock carries a Zacks Rank of 3.

Fiserv, Inc. FISV is scheduled to release third-quarter earnings on Nov 6. The Zacks Consensus Estimate for the same stands at 98 cents, indicating 30.7% increase from the year-ago reported figure. The stock has a Zacks Rank #2 (Buy).

WEX Inc. WEX is set to report third-quarter earnings on Oct 30. The consensus mark for earnings is pegged at $2.59, suggesting 18.3% improvement from the year-earlier reported figure. The company is Zacks #3 Ranked.

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