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On Wednesday, Raymond (NSE:RYMD) James maintained its optimistic stance on Shift4 Payments (NYSE:FOUR), with a significant adjustment to the company’s price target, raising it to $140 from the previous $115, while reiterating an Outperform stock rating. The revision follows a series of notable developments, including the company’s fourth-quarter performance, a recent investor day, and the announcement of its largest acquisition to date. According to InvestingPro data, the stock has shown remarkable momentum with a 62% return over the past year and is currently trading near its 52-week high of $127.50.
Shift4 Payments announced the acquisition of Global Blue for approximately $2.5 billion, a move that analysts at Raymond James view as a strategic fit expected to be slightly accretive to the company’s earnings per share (EPS) by 2026. The company, which currently generates $3.15 billion in revenue with an EBITDA of $457.4 million, has maintained strong financial health, earning a "GREAT" overall score on InvestingPro’s comprehensive assessment. Despite the company’s initial 2025 revenue and EBITDA projections being slightly below Wall Street’s expectations, Raymond James perceives management’s guidance approach as cautious and prudent, which they find encouraging.
The company has also set ambitious mid-term targets, aiming for a high-teens compound annual growth rate (CAGR) in revenue and EBITDA, excluding the impact of Global Blue. Moreover, management has presented a "most likely" scenario that includes capital allocation and anticipates over 30% CAGR in revenue and EBITDA over a three-year span, a target deemed achievable by Raymond James due to Shift4 Payments’ strong M&A track record.
The analyst’s commentary highlighted the confidence gained from the investor day, suggesting that the management team is well-equipped to continue delivering high performance. With the stock currently trading at around 20 times the forecasted 2026 free cash flow (FCF) and with a growth CAGR exceeding 30%, Raymond James suggests that any market weakness could be a favorable opportunity for investors.
In other recent news, Shift4 Payments Inc . reported stronger-than-expected earnings and revenue figures for the fourth quarter of 2024. The company’s earnings per share (EPS) came in at $1.35, surpassing the forecasted $1.13, and revenue reached $887 million, significantly exceeding the anticipated $406.93 million.
Additionally, Shift4 has announced strategic initiatives, including international expansion and new product capabilities. The company’s acquisition of Global Blue is projected to generate significant revenue synergies by 2027.
Shift4 Payments showcased robust growth in the fourth quarter of 2024, with end-to-end tenant volumes increasing by 49% year-over-year to $47.9 billion. The company also reported a 50% rise in gross revenue less network fees, reaching $5 billion.
Looking ahead, Shift4 projects a volume growth of 21-33% for 2025, with gross revenue expected to rise by 22-27%. The company aims for an adjusted EBITDA between $830 million and $855 million, representing a 23-26% increase. These projections exclude the impact of the Global Blue acquisition, which is anticipated to unlock $80 million in revenue synergies by 2027.
CEO Jared Isaacman emphasized Shift4’s leadership position in key markets, while President Carolyn Lauber highlighted the strategic value of the Global Blue acquisition. These are recent developments in the company’s ongoing growth and expansion strategy.
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