Elliot Management's Stake in Global Payments Seen as Catalyst for Shares

B. Riley Securities reiterates a Buy rating on Global Payments with a $194 price target following reports that activist investor Elliot Management has taken a significant stake in the company. The analyst sees this as a key catalyst for the shares, which are among the cheapest in the S&P 500 Index, and believes there is "substantial upside" to the fair value price target.

Global Payments (GPN), a major player in the payment processing industry, has seen its stock gain attention following reports that activist investor Elliott Management has acquired a significant stake in the company. The news has sparked interest among analysts and investors, with B.Riley Securities reiterating a Buy rating on GPN with a $194 price target, highlighting the potential for substantial upside [1].

Elliott Management's entry into GPN's shareholder ranks comes amid lingering concerns over the company's $24.2 billion acquisition of Worldpay. The deal, aimed at positioning GPN as a global leader in payment processing, has faced operational challenges and investor skepticism [3]. However, Elliott's involvement signals a potential inflection point, as the hedge fund is known for its aggressive corporate governance campaigns and its ability to drive strategic realignment [3].

B.Riley Securities sees Elliott's stake as a key catalyst for GPN's shares, which are among the cheapest in the S&P 500 Index. The analyst believes there is "substantial upside" to the fair value price target, citing the potential for cost-cutting, divestment of non-core assets, and a refocus on high-growth payment verticals [1]. These moves could unlock value long buried under integration costs and market skepticism.

The activist involvement could also lend credence to actions already committed to by Global Payments management. The company has maintained dividend payments for 25 consecutive years and has been aggressively buying back shares, demonstrating a track record of shareholder returns [1]. Elliott could potentially advocate for management changes to enhance execution credibility and push for greater cost synergies from the Worldpay deal [2].

In the realm of analyst ratings, Keefe, Bruyette & Woods and BMO Capital Markets both maintained a Market Perform rating, with price targets of $81 and $86, respectively. BMO Capital noted the sale of the payroll business as a strategic move that provides financial flexibility ahead of the Worldpay acquisition [2]. The company has also introduced a new point-of-sale system called Genius for Retail, designed to support small and medium-sized retail businesses with advanced payment capabilities and business management tools [1].

Global Payments has reported over 5% constant currency adjusted net revenue growth and an 11% constant currency adjusted earnings per share growth compared to the same period in 2024. The company is aggressively executing its transformation agenda, including simplifying its organizational structure and increasing its benefit target by 20% to $600 million [2]. The acquisition of Worldpay is expected to enhance GPN's global scale and position it as a leading pure-play commerce solutions provider for merchants worldwide [2].

References:
[1] https://www.investing.com/news/analyst-ratings/global-payments-stock-rating-reiterated-at-market-perform-by-bernstein-93CH-4138078
[2] https://www.gurufocus.com/news/2980156/elliott-management-acquires-substantial-stake-in-global-payments-gpn-gpn-stock-news
[3] https://www.ainvest.com/news/activist-catalysts-ignite-global-payments-elliott-stake-signals-strategic-turnaround-2507/