S&P Lowers Global Payments (GPN) to Hold from Buy

S&P lowered Global Payments (NYSE: GPN) to hold from buy in the Aug. 4, edition of The Outlook. GPN missed S&P’s quarterly earnings estimate by $.01. S&P sees flat operating margins in fiscal 2011.

Here are quotes from the report:

"May-quarter EPS from continuing operations of $0.56 was $0.01 below our estimate. Sale rose 16% to $425 million, $24 million above our view, driven by strength in U.S.
merchant services. International growth was strong, particularly in Asia, but Global Payments faces challenges in countries such as Canada and the Czech Republic. We
see this contributing to flat operating margins in fiscal 2011 (ending May); we see wider margins in fiscal 2012 as system consolidations offer operating leverage. We trimmed our fiscal 2011 EPS estimate by $0.06 to $2.75 and set our fiscal 2012 estimate at $3.12. We also cut our target price on this Master List stock by $10 to $44."