Total System Strengthens in Zimbabwe - Analyst Blog
11 Diciembre 2012 - 11:40AM
Zacks
Boosting its merchant acquiring services, Total System
Services Inc. (TSS) announced a strategic alliance with
Zimbabwe-based NMB Bank Ltd. Through this alliance, Total System
plans to use its PRIME 4 card management solution – a
multi-resource single technology platform that offers card
solutions to acquirers and issuers.
Accordingly, NMB Bank has agreed to shift its credit card
portfolio from Visa Inc. (V) to Total System’s
PRIME 4, in order to enable its cards to operate on improved
security and management. PRIME 4 solutions are designed in
compliance with Service Orientated Architecture and benefit the
users with a web-based and scalable solution. NMB Bank is now added
to the list of more than 130 clients who use the company’s PRIME 4
technology in over 70 countries.
Moreover, Total System’s penetration into Zimbabwe also
fortifies its position in Africa, where the top banks of South
Africa, Nigeria and Kenya already stand to benefit from the
merchant acquiring services of the company. Over the last couple of
years, Total Systemhas been making technological advancements
through the PRIME 4 card management solutions, VAR Partner Connect
Program and Mobile App. These technical solutions have driven the
accounts on file of the company and helped it earn significant
contracts and alliances to drive long-term growth.
Total System has been witnessing improvement in its financials
over the past few quarters based on its steady fundamental growth
initiatives. Its risk-free balance sheet, modest cash position and
cash flow generating capability provide viable scope for efficient
capital deployment. However, risks related to operating leverage
and competitive pressure fromarch-rivals such as Heartland
Payment Systems Inc. (HPY) and WEX Inc.
(WXS) remain eminent.
Based on the pros and cons, the Zacks Consensus Estimate
currently pegs earnings at 33 cents for the fourth quarter of 2012,
up about 6% over the prior-year quarter. For 2012, earnings are
projected to increase to $1.29 per share. This reflects an increase
of about 12.5% year over year, which is slightly higher than the
upper end of management’s guidance of 10–12% growth for 2012. Based
on its influential contracts, management also expects to achieve
the higher-end of its guidance in all growth metrics
Currently, we maintain a long-term Neutral stance on Total
System with a Zacks Rank #3, which implies a short-term Hold
rating.
HEARTLAND PAYMT (HPY): Free Stock Analysis Report
TOTAL SYS SVC (TSS): Free Stock Analysis Report
VISA INC-A (V): Free Stock Analysis Report
WEX INC (WXS): Free Stock Analysis Report
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