Citi raises Euronet stock price target to $115, maintains neutral

On Tuesday, Citi analysts updated their valuation model for Euronet Worldwide , listed on (NASDAQ:EEFT), leading to an increase in the stock’s price target. The firm now anticipates a target price of $115, up from the previous $110, while sustaining a Neutral stance on the stock. According to InvestingPro data, the company currently trades at a P/E ratio of 15.46x, suggesting attractive valuation levels relative to its growth prospects.

The adjustment comes after a thorough review of Euronet’s annual report and its fourth-quarter earnings, alongside slight modifications to growth and margin projections. The revised forecast for fiscal year 2025 emphasizes an uptick in revenue, particularly within the EFT segment, attributed to the potential gains from ATM direct access fee contributions. The company has demonstrated solid growth, with revenue increasing by 8.18% over the last twelve months to nearly $4 billion, though InvestingPro analysis indicates relatively weak gross profit margins at 23.82%.

Despite the positive outlook on Euronet’s top-line growth, Citi analysts foresee certain financial headwinds. They predict an escalation in interest expenses and a rise in the effective tax rate. However, these factors are expected to be largely counterbalanced by a swifter expansion in EBITDA, which currently stands at $635 million, and is projected to lead to a modest increase in adjusted earnings per share for the fiscal year 2025.

The new price target of $115 is primarily based on the improved forward-looking estimates, which are incorporated into Citi’s cash flow analysis and multiple valuation methods. The analysts’ commentary underscores the impact of the EFT segment’s performance on the company’s future financial prospects.

Euronet Worldwide has not publicly responded to the updated price target at this time. The company’s shares will continue to be monitored by investors as they assess the implications of Citi’s revised expectations and the company’s strategic initiatives in response to the evolving financial services landscape.

In other recent news, Euronet Worldwide reported impressive fourth-quarter 2024 earnings, surpassing analyst expectations with an earnings per share (EPS) of $2.08 and revenue of $1.05 billion, both exceeding forecasts. The company’s strong performance was bolstered by a 15% year-over-year growth in Non-GAAP EPS for the year. Following these results, DA Davidson raised its price target for Euronet to $140, maintaining a Buy rating, while Keefe, Bruyette & Woods increased their price target to $112, citing robust performance in the EFT segment. Euronet’s management has revised its EPS growth forecast for 2025 to 12%-16%, reflecting confidence in continued strong financial performance.

The company also reported full-year 2024 revenue of $4 billion, with adjusted operating income of $500 million and adjusted EBITDA nearing $700 million. Euronet’s strategic initiatives, including new product launches and partnerships, contributed to its revenue growth, which outpaced the global payments market. The company’s diversified operations and strong balance sheet have positioned it well for sustained growth, with plans to expand digital initiatives and enter new geographic markets. Analysts from Keefe, Bruyette & Woods and DA Davidson have expressed optimism about Euronet’s future, reflecting a positive outlook for the company’s continued growth trajectory.

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