Evertec stock rating reiterated at outperform by William Blair

Investing.com - William Blair reiterated its outperform rating on Evertec (NYSE:EVTC) on Monday, citing the company’s expansion potential in Latin American markets. The company, which boasts a perfect Piotroski Score of 9 according to InvestingPro data, has demonstrated strong financial health with impressive revenue growth of 17.4% in the last twelve months.

The firm highlighted 2022 as a pivotal year when Evertec cleared restrictions related to the Bank Holding Company Act, enabling more aggressive merger and acquisition activities to diversify beyond Puerto Rico into faster-growing markets.

William Blair expects Evertec’s Puerto Rico business, which represents 65% of revenue, to grow at a low- to mid-single-digit rate while generating high margins and cash flow, while the Latin American segment (35% of revenue) is projected to grow at a double-digit pace.

The company generated $170 million in free cash flow in 2024 and exited the March quarter with leverage at 2-times, positioning it for additional acquisitions to further expand into Latin America.

William Blair noted that with enterprise value at 8.3 times 2025 EBITDA, Evertec has room for multiple expansion as its business mix evolves toward faster-growing markets outside Puerto Rico.

In other recent news, Evertec Inc . reported strong financial results for the first quarter of 2025, surpassing both earnings and revenue forecasts. The company achieved an adjusted earnings per share of $0.87, exceeding the forecasted $0.79, while revenue rose to $228.8 million, outperforming expectations of $217.97 million. This represents a notable 11.4% year-over-year increase in revenue, driven by organic growth in Latin America and technological advancements in Brazil. Additionally, Keefe, Bruyette & Woods raised Evertec’s stock price target to $44, citing the company’s strong execution and a robust start to the year.

During Evertec’s 2025 Annual Meeting of Stockholders, all proposed measures were approved, including the election of directors and the ratification of Deloitte & Touche LLP as the independent auditor. The advisory vote on executive compensation also passed, reflecting shareholder approval of the company’s approach. Analyst Vasundhara Govi from Keefe highlighted Evertec’s strong market presence and consistent performance, expressing confidence in the company’s ability to sustain its growth trajectory.

The company maintains a solid liquidity position with $460 million and has provided a positive outlook for 2025, with revenue guidance between $903 million and $911 million. Evertec continues to focus on mergers and acquisitions as part of its growth strategy, with CEO Max Schuessler emphasizing the importance of these efforts. The company’s performance and strategic positioning have led to optimism about its future prospects, despite potential macroeconomic challenges.

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