2Q26 EPS Preview - A 10% Debate at a 13x GAAP Multiple; Remain Overweight

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2Q26 EPS Preview - A 10% Debate at a 13x GAAP Multiple; Remain Overweight

IdeaMcapacity for repurchases, Corporate Payments M&A, or both. At just ~13x our 2028

GAAP EPS estimate for ~19% '26-'28 GAAP EPS CAGR, we remain Overweight and

raise our PT to $415 (~15% upside), as we roll forward to '28.

Vehicle Payments can sustain 8-10% growth. Investor concern centers on a

continuation of Google Search related headwinds issue in Brazil—management had

flagged a ~1pt headwind to 1Q26 Brazil revenue growth from a key word change

impacting its vehicle debt business—and Corpay’s decision to direct fewer

incremental S&M dollars toward Vehicle Payments, which investors don't believe

the company would be doing if the business was performing well given the margin

differential of Vehicle Payments (~50% in '25) vs. Corporate Payments (~38% in '25).

For our part, we expect Brazil revenue per tag could to continue to prove more

durable than tag growth alone as toll pricing and cross-sell across fuel, parking,

insurance, and vehicle debts broaden monetization of Sem Parar’s existing installed

base. Meanwhile, an improving freight backdrop could provide modest same-store-

sales support to U.S. fleet. We therefore view lower Vehicle S&M intensity as

consistent with Corpay’s broader portfolio rotation, particularly when you consider

relative sum-of-the-parts multiple treatment between Vehicle Payments and

Corporate Payments ( Exhibit 4 ).

Law of large numbers is now the Corporate Payments debate. Relative to the last

few quarters, investors seem to have grown increasingly comfortable with the

notion that stablecoins / on-chain FX are unlikely to impact the business over the

medium-term, which we agree with and outlined in our assumption of coverage and