Heartland Payment Systems Earnings Preview

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Heartland Payment Systems (NYS: HPY) will look to avoid missing estimates for the consecutive quarter when its earnings are released. The company will unveil its latest earnings Thursday. Heartland Payment Systems provides payment processing services related to bank card transactions for merchants throughout the United States and some parts of Canada.

What analysts say:

  • Buy, sell, or hold?: Analysts think investors should stand pat on Heartland Payment Systems, with eight of 13 analysts rating it hold. Analysts like Heartland Payment Systems better than competitor Wright Express overall. Two out of seven analysts rate Wright Express a buy compared with five of 13 for Heartland Payment Systems. Analysts still rate the stock a hold, but they are a bit more wary about it compared with three months ago.
  • Revenue forecasts: On average, analysts predict $124.7 million in revenue this quarter. That would represent a rise of 8.3% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.27 per share. Estimates range from $0.24 to $0.29.

What our community says:
CAPS All-Stars are solidly behind the stock, with 96.3% awarding it an "outperform" rating. The community at large backs the All-Stars, with 94.2% assigning it a rating of "outperform." Fools are gung-ho about Heartland Payment Systems and haven't been shy with their opinions lately, logging 108 posts in the past 30 days. Even with a robust four out of five stars, Heartland Payment Systems' CAPS rating falls a little short of the community's upbeat outlook.

Management:
The company increased its gross margin by 2.3 percentage points in the last quarter. Revenue rose 13.7% while cost of sales rose 10.9% to $423 million from a year earlier.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter

Q1

Q4

Q3

Q2

Gross Margin

9.5%

8.7%

8%

8.2%

Operating Margin

3.1%

3%

2.8%

3.2%

Net Margin

1.7%

1.4%

1.5%

1.3%

For all our Heartland Payment Systems-specific analysis, including earnings and beyond, add Heartland Payment Systems to My Watchlist.

The Motley Fool owns shares of Heartland Payment Systems. Motley Fool newsletter services have recommended buying shares of Heartland Payment Systems.Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

At the time this article was published

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