Global Payments (GPN) to Buy Mineral Tree, Ups View, Shares Up
Global Payments (GPN) to buy Mineral Tree for advancement in the cloud-based business-to-business payments space.
In a bid to deepen its toes in the business-to-business (B2B) cloud payments market, Global Payments Inc. GPN has announced that it will acquire Mineral Tree. This fintech company via its automated technology manages accounts payable process of businesses on cloud.
Other announcements made on the same day were that the company was selected as the official commerce technology provider of Mercedes-Benz stadium and that it forged a strategic alliance with Virgin Money to launch a connected payment offering. Shares of the company rose 7.2% following these positive developments. Year to date, the stock has lost 21.1% compared with its industry’s decline of 12.5%.
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With Mineral Tree, the company can now access the large $125-trillion worth B2B market, which is under-digitized and thus offers ample scope for growth.
Mineral Tree’s software-as-a-service (SAAS) offerings best complement Global Payments' existing B2B payments capabilities. These include leadership in commercial payments, domestic and international acquiring, payroll, data and analytics, access to non-card based rails and virtual-card provisioning.
Together with Mineral Tree, the company will find avenues for significant incremental growth in one of the most attractive technology markets of B2B cloud payments.
The company already has a substantial presence in the B2B space with capabilities built around its commercial and virtual cards, employee payroll management, bill payments and expense management. The B2B business generates more than $600 billion of revenues for the company at present.
Global Payments is a top-quartile SaaS company with presence across Europe, APAC, North America and LATAM. The company is benefiting from digitization and invested $2.5 billion in acquisitions during the pandemic with more than 60% spent on tech-enabled, cloud-native environments. It was selected as a preferred provider of merchant-acquiring services for AWS of Amazon.com, Inc. AMZN and also on Google Cloud.
Cloud-based payment gathered steam and is the way forward as customers desire speed, transparency and automation in their payment processes. Global Payments is marching in the right direction and is poised for growth over the long haul. Other companies dealing in cloud-based solutions are Automatic Data Processing, Inc. ADP.
The stock carries a Zacks Rank #3 (Hold), currently. Another stock in the same space is EVO Payments, Inc. EVOP. It beat estimates in each of the trailing four quarters with an average positive surprise of 13.29%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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