Analyst Tien Tsin Huang of J.P. Morgan maintained a Hold rating on Global Payments (GPN – Research Report), with a price target of $85.00.
Tien Tsin Huang’s rating is based on a combination of factors, primarily revolving around Global Payments’ current transitional phase and the pending acquisition of Worldpay. The company’s recent quarterly results were stable, with encouraging volume and transaction trends, but the integration of Worldpay introduces significant complexity and execution risk. This acquisition is expected to bring synergies and growth opportunities, yet the intricacies involved in merging the two entities make it challenging to predict accelerated growth confidently.
Additionally, while Global Payments’ shares appear undervalued by several metrics, the company is undergoing a significant transformation with its new operating model. This includes restructuring its business lines and consolidating technology under the Genius brand, which could introduce risks such as attrition and sales execution challenges. Given these factors, Huang suggests that patience is necessary as the company navigates these changes, which justifies the Hold rating until clearer execution and integration outcomes are observed.
In another report released today, KBW also maintained a Hold rating on the stock with a $81.00 price target.