GPN – Market expectations are for Uniform ROA to improve, but management may have concerns about their market share, volumes, and strategies

• Global Payments Inc. (GPN:USA) currently trades near historical highs relative toUAFRS-based (Uniform) earnings, with a 37.9x Uniform P/E. At these levels, the market has bullish expectations for the firm, but management may have concerns about their market share, merchant volumes, and technology-enabled strategy
  
• Specifically, management may lack confidence in their ability to expand market share, continue executing Xenial’s cross-sell strategy, and invest in all three levers of their business. Furthermore, they may be exaggerating their ability to deliver annual run rate revenue synergies and expense savings, and they may lack confidence in the potential of their merchant volumes. Also, they may have concerns about the continued pressure on the Travel and Entertainment (T&E) industry and commercial card business, the potential of their technology-enabled strategy, and the client’s varying pace of patent realization. Finally, they may be overstating the capabilities of their merchant referral agreement with CIBC in Canada, the opportunities of their joint venture with MoneyToPay, and the sustainability of sales growth in Spain