GPN

Global Payments trades at just 11.6x FY2025 EPS of $5.78 and 2.4x sales, a discount that reflects a business in heavy transition rather than decline. Revenue was essentially flat at $7.71B (the MD&A notes $7,705.9M vs $7,736.0M) despite divesting AdvancedMD and Payroll Solutions, and net income slipped 10.8% to $1.40B as the company absorbed transformation costs ahead of the Issuer Solutions divestiture and Worldpay integration. Merchant Solutions operating margin actually improved on cost-reduction actions, and consolidated operating margin remains a respectable 22.8%.

The strategic reset is the central question. Management launched a holistic transformation in 2024 and expects more than $650M of annual run-rate operating income benefit by the first half of 2027, with incremental transformation expense running through that period. The portfolio is being reshaped — divesting Issuer Solutions while integrating Worldpay — which explains the balance-sheet swings: long-term debt jumped 32% to $21.6B, cash ballooned 254% to $8.34B, shares rose 13%, and total liabilities climbed 23.8% (liabilities/equity now 1.29x). ROE of 6.1% is depressed by the enlarged equity base.