Defensive Moat & Synergies in Sight; Confidence Still Rebuilding: Resume at EW

研报英文原文证据摘录

Defensive Moat & Synergies in Sight; Confidence Still Rebuilding: Resume at EW

1x our 2027 GAAP EPS of § = Consensus data is provided by Refinitiv Estimates

e = Morgan Stanley Research estimates

$4.47). We think investors will likely require at least a couple quarters of strong

Quarterly EPS ($)

performance to rebuild confidence, and acknowledge that GPN screens cheaper at 2026e 2026e 2027e 2027e

Quarter 2025 Prior Current Prior Current

4x '27 Adj. EPS with a similar to-do list. Additionally, we expect a broader sentiment

Q1 1.21 - 1.36a 1.44 1.45

improvement/rerating in the Payments space will likely be needed to support Q2 1.37 1.56 1.46 1.69 1.58

multiple expansion toward our bull case of 10x. Q3 1.51 1.60 1.65 1.74 1.79

Q4 1.68 1.71 1.75 1.86 1.91

Issuer acquisition synergies underway; deal creates attractive end-to-end e = Morgan Stanley Research estimates, a = Actual Company reported data

product breadth and defensible fundamentals, though we'd like to see early

evidence of strong execution. We believe the Issuer acquisition has strong strategic

rationale with compelling cross-sell opportunity and an expanded end-to-end suite

of offerings for banks. We view the near-term revenue synergy target of $45-50M

over three years as achievable, with a clear path to the longer-term target of $125M

annually as competitor contracts come up for renewal. TSYS adds 885M+ accounts

on file and meaningful credit capabilities, while FIS already sells at least one

solution into ~50% of TSYS’s Issuer base and TSYS sells into ~25% of FIS’s.

Additionally, we expect cost savings of $150M by year 3 should be straight-forward

to deliver. The new revenue and earnings structure is also more defensible, with

largely recurring revenue streams driven by long-term technology contracts with