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Investing.com - Raymond (NSE:RYMD) James lowered its price target on Corpay (NYSE:CPAY), a $22.2 billion payment solutions provider, to $392 from $414 while maintaining an Outperform rating following the company’s second-quarter results. According to InvestingPro data, the stock currently trades at a premium valuation with a P/E ratio of 21.7x.
The firm noted that Corpay delivered in-line second-quarter results with revenue and earnings per share largely matching consensus expectations, although organic growth was slightly below expectations by approximately 100 basis points. The company maintains strong fundamentals with a 78.2% gross profit margin and 6.7% year-over-year revenue growth.
Raymond James highlighted that management raised its 2025 outlook modestly due to higher fuel prices and foreign exchange factors, but simultaneously lowered its 2025 organic growth expectation by 100 basis points to 10%, attributed entirely to weakness in the Lodging segment.
The Lodging business is now expected to decline low single digits compared to previous expectations of low single-digit growth, driven by weather-related factors and weak sales momentum, creating a headwind of more than $30 million.
Despite these challenges, Raymond James expressed encouragement about U.S. vehicle organic growth turning positive with expected acceleration in the second half of 2025, along with continued high-teens growth in Corporate Payments. Analysts maintain a bullish stance on the stock, with consensus targets ranging from $330 to $445.
In other recent news, Corpay Inc. reported its second-quarter 2025 earnings, surpassing Wall Street expectations. The company achieved an earnings per share (EPS) of $5.13, slightly above the forecasted $5.11. Revenue for the quarter reached $1.1 billion, which was in line with projections. Despite this earnings beat, the stock experienced a 1.1% decline in aftermarket trading. Investors are carefully evaluating the company’s financial performance and future guidance. These developments reflect the market’s cautious approach to Corpay’s recent financial results.
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