Raymond James upgraded Shift4 Payments (NYSE:FOUR) to an Outperform rating (From Market Perform) and set a 12-month price target on the stock of $74.00, representing ~36% upside.
Analysts wrote in a note, “We believe the narrative is likely to shift from concerns around the macro dependency of restaurant and lodging (~60% of current volume) and more toward the ramping of new verticals and international expansion given new wins outside the core.”
A big chunk of the FOUR’s new successes since 2022 are coming from areas that aren't as dependent on the overall economy. This is making the company's overall mix and profits better. Furthermore, when Finaro closes, probably in late 3Q or early 4Q, it's likely to give the company's stock a boost, setting things up for the next round of growth.
“We see upside to FY24 Street estimates, assuming Finaro does in fact close, given the Street is implying just ~22% organic revenue growth (~800 bp decel) and ~80 bp of EBITDA margin expansion,” added analysts.
Shares of FOUR are up 3.80% in pre-market trading Tuesday morning.