Global Payments Inc (GPN): A Strong Contender in the Business Services Industry with a High GF Score
Global Payments Inc (NYSE:GPN), a leading player in the Business Services industry, is currently trading at $128.73 with a market capitalization of $33.47 billion. The stock has seen a gain of 3.78% today and a significant increase of 21.19% over the past four weeks. According to GuruFocus, GPN has a GF Score of 87 out of 100, indicating good outperformance potential. The GF Score is a comprehensive stock performance ranking system that considers five key aspects: Financial Strength, Profitability Rank, Growth Rank, GF Value Rank, and Momentum Rank.
Financial Strength Analysis
GPN's Financial Strength rank is 4/10, which is influenced by its debt burden, debt to revenue ratio, and Altman Z-Score. The company's interest coverage is 2.87, indicating its ability to cover interest expenses with its earnings. Its debt to revenue ratio is 1.89, suggesting a moderate level of debt relative to its revenue. The Altman Z-Score of 1.16 indicates some financial risk.
Profitability Rank Analysis
The company's Profitability Rank is 8/10, reflecting its strong profitability. GPN's operating margin is 17.66%, and its Piotroski F-Score is 8, indicating a healthy financial situation. The company has shown consistent profitability over the past 10 years and has a Predictability Rank of 3.
Growth Rank Analysis
GPN's Growth Rank is 9/10, reflecting strong growth in terms of revenue and profitability. The company's 5-year revenue growth rate is 6.40%, and its 3-year revenue growth rate is 9.70%. Its 5-year EBITDA growth rate is 6.10%, indicating consistent growth in its business operations.
GF Value Rank Analysis
The company's GF Value Rank is 9/10, suggesting that the stock is fairly valued. The GF Value Rank is determined by the price-to-GF-Value ratio, a proprietary metric calculated based on historical multiples and an adjustment factor based on a company's past returns and growth.
Momentum Rank Analysis
GPN's Momentum Rank is 5/10, reflecting its average momentum. The Momentum Rank is determined using the standardized momentum ratio and other momentum indicators.
Competitor Analysis
When compared to its competitors in the same industry, GPN holds a strong position. Copart Inc (NASDAQ:CPRT) has a GF Score of 96, Aramark (NYSE:ARMK) has a GF Score of 73, and Dolby Laboratories Inc (NYSE:DLB) has a GF Score of 84. More details about these competitors can be found here.
Conclusion
In conclusion, Global Payments Inc (NYSE:GPN) has a high GF Score of 87, indicating good outperformance potential. Its strong profitability, consistent growth, and fair valuation make it a compelling choice for investors. However, its moderate financial strength and average momentum should be taken into consideration. As always, potential investors should conduct their own comprehensive analysis before making investment decisions.
This article first appeared on GuruFocus.
