Analyst Says Buy Vantiv; Sees Bull Case 'Uninhibited By The Macro'

• The share price of Vantiv Inc VNTV has appreciated 33.41 percent over the past year, almost up to the 52 week high on December 1 at $52.84.
• Josh Beck of Pacific Crest has maintained an Overweight rating on the company, with a price target of $57.
• Beck expects the company to close 2015 “on a strong note,” with robust 4Q15 results and “prudent” 2016 guidance.

Analyst Josh Beck said, “Vantiv has strong secular tailwinds, in our view, spanning digital payments, security, software and e-commerce with little exposure to macro headwinds like FX, gas, regulation, credit, or discretionary spending.”

Beck expects the estimates for 4Q15 to prove conservative and for the company to report a strong beat. The revenue estimate for the quarter is $434 million, driven by strength in merchant services, where Beck sees several tailwinds, such as value-added services and strategic channels.

The analyst also expects Vantiv’s “very high incremental margins to drive EBITDA margins just shy of 50 percent at 49.6 percent, and EPS of $0.62.”

The 2016 guidance is expected to bracket the consensus forecasts in either the middle or the higher end of the range, with the EPS growth guidance in the mid-teens.

According to the Pacific Crest report, the company is “one of the best-positioned names in fintech across key secular themes with little exposure to macro risk factors.”

Sustained execution is expected to help Vantiv grow its top line in the low double digit range, with EPS growth of more than 20 percent in 2016.