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ATLANTA - Corpay, Inc. (NYSE: CPAY), a member of the global S&P 500 and a corporate payments company, today announced the successful amendment of its Term Loan B credit facility, increasing it by $750 million. This move is said to be leverage neutral, with unchanged interest rates and maturity terms of the existing credit facility.
The fresh capital will initially be used to reduce the company’s revolver balance, freeing up about $1.5 billion of undrawn capacity. This financial restructuring is part of Corpay’s strategy to bolster its balance sheet in preparation for its 2025 capital plan, which includes expanding its Corporate Payments business. The company’s current debt-to-equity ratio stands at 2.56, while maintaining a healthy current ratio of 1.0.
Ron Clarke, chairman and CEO of Corpay, expressed satisfaction with the oversubscribed demand for the credit facility, interpreting it as a sign of market confidence in the company’s earnings stability. Tom Panther, CFO of Corpay, highlighted the company’s favorable credit spreads and substantial cash flow as key factors enabling the execution of their capital plan without increasing the leverage ratio.
Credit rating agencies Moody’s (NYSE:MCO) and S&P Global have maintained their Ba1 and BB+ ratings, respectively, for Corpay, along with a stable credit outlook. This reflects the financial community’s confidence in the company’s performance and creditworthiness.
The transaction involved a consortium of financial institutions, including Bank of America, N.A. as the Administrative Agent, and several other banks as Joint Lead Arrangers and Joint Bookrunners.
Corpay specializes in providing commercial card products and automated payment solutions to businesses worldwide, aiming to help customers manage their spending and reduce fraud. The company’s services include business cards, fleet cards, virtual cards, as well as invoice and payments automation.
This financial development is based on a press release statement from Corpay, Inc. and reflects the company’s current position and plans for capital management as it continues to grow its services in the corporate payments sector.
In other recent news, Corpay reported fourth-quarter earnings that exceeded expectations, with adjusted earnings per share (EPS) of $5.36, surpassing the analyst consensus of $5.32. However, the company faced a revenue shortfall, reporting $1.03 billion against the anticipated $1.06 billion. Corpay’s guidance for 2025 also fell short, forecasting adjusted EPS between $20.75 and $21.25, below the expected $21.93, and revenue projections ranging from $4.35 billion to $4.45 billion, slightly under the consensus estimate of $4.45 billion. RBC Capital Markets adjusted its price target for Corpay to $400, maintaining a Sector Perform rating, while noting the company’s strong corporate payments segment amidst challenging macroeconomic conditions. Meanwhile, BMO Capital Markets lowered its price target to $440 from $450, retaining an Outperform rating, and highlighted positive trends such as accelerated organic growth, despite macroeconomic headwinds. Keefe, Bruyette & Woods raised their price target to $445, maintaining an Outperform rating, and noted potential for growth through mergers and acquisitions. The firm also adjusted EPS estimates for 2025 and 2026 to $21.07 and $24.21, respectively. Investors continue to watch Corpay closely, considering these revised forecasts and the company’s strategic initiatives in response to economic challenges.
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