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CPAY Stock Study (10-29-25)

Posted by on February 3, 2025 at 07:18 | Last modified: October 29, 2025 08:35

I recently did a stock study on Corpay, Inc. [CPAY (formerly FLT), $285.59]. Previous studies are here, here, and here.

Value Line writes:

     > Corpay, Inc. (formerly FLEETCOR) is a leading independent provider of
     > fuel cards, and payment products and services throughout North America,
     > Latin America, and Europe. Its corporate charge cards cater to
     > commercial fleets, major oil companies, petroleum marketers, and
     > government entities. The company owns and operates proprietary
     > closed-loop networks electronically connected to merchants, through
     > which it captures and reports customized information.

Over the past decade, the medium-size company has grown sales and earnings at annualized rates of 9.6% and 13.7%, respectively. Lines are mostly up, straight, and parallel except for a sales+EPS decline in ’20. Ten-year EPS R^2 is 0.85 and Value Line (VL) gives an Earnings Predictability score of 85.

Over the past decade, PTPM leads peer averages but trails the industry while ranging from 31.5% in ’15 to 45.0% in ’18 with a last-5-year mean of 36.7%. ROE leads peer averages and tracks even with the industry while increasing from 12.0% (’15) to 31.8% (’24) with a last-5-year mean of 30.3%. Debt-to-Capital is lower than peer and industry averages while trending higher from 50.9% (’15) to 71.9% (’24) with a last-5-year mean of 67.3%.

Quick Ratio is 0.67 and Interest Coverage is 4.8 per M* who assigns “Narrow” [quantitative] Economic Moat and gives a C grade for Financial Health (per BI website). VL gives a B+ grade for Financial Strength. CFRA writes: “We have a positive view of CPAY’s balance sheet, with a leverage ratio of 2.5x trailing 12-month EBITDA and total liquidity at $3.5B.”

With regard to sales growth:

I am forecasting below the range at 9.0% per year.

With regard to EPS growth:

My 10.0% per year forecast is below the long-term-estimate range [mean of six (tightly clustered within 0.5%): 13.2%]. Initial value is ’24 EPS of $13.97/share instead of 2025 Q2 $14.72 (annualized).

My Forecast High P/E is 21.0. Over the last 10 years, high P/E falls from 43.0 (’15) to 27.6 (’24) with a last-5-year mean of 28.1 and a last-5-year-mean average P/E of 22.6. I am below the range.

My Forecast Low P/E is 13.0. Over the last 10 years, low P/E falls from 34.9 (’15) to 17.7 (’24) with a last-5-year mean of 17.0. I am forecasting at bottom of the range.

My Low Stock Price Forecast (LSPF) is $200.00. Default ($181.60) based on initial value given above seems unreasonably low at 36.4% (32.5%) less than the previous close (52-week low). My [arbitrary] selection is 30.0% (25.7%) less, respectively.

These inputs land CPAY in the HOLD zone with a U/D ratio of 2.2. Total Annualized Return (TAR) is 10.6%.

PAR (using Forecast Average—not High—P/E) is less than I seek for a medium-size company at 6.0%. If a healthy margin of safety (MOS) anchors this study, then I can proceed based on TAR instead.

To assess MOS, I compare my inputs with those of Member Sentiment (MS). Based on 139 studies done in the past 90 days (my study and 34 outliers excluded), averages (lower of mean/median) for projected sales growth, projected EPS growth, Forecast High P/E, and Forecast Low P/E are 10.2%, 12.0%, 24.3, and 16.3, respectively. I am lower across the board. VL projects a future average annual P/E of 15.0 that is less than MS (20.3) and less than mine (17.0).

MS high / low EPS are $25.89 / $14.39 vs. my $22.50 / $13.97 (per share). My high EPS is lower due to a lower growth rate. VL’s high EPS of $35.40 soars above both.

MS LSPF of $232.40 implies a Forecast Low P/E of 16.2 vs. the above-stated 16.3. MS LSPF is 0.9% less than the default $14.39/share * 16.3 = $234.56. MS LSPF is 16.2% greater than mine, however.

I think MOS is robust in this study because my inputs are near or below analyst/MS estimates and historical ranges. MS TAR (16.3%) is 5.7% per year greater than mine.

With regard to valuation, PEG is 1.0 and 1.8 per Zacks and my projected P/E, respectively: fairly valued (1.7 per M*). Relative Value [(current P/E) / 5-year-mean average P/E] is slightly low at 0.86.

Per U/D, CPAY is a BUY under $268/share. BI TAR criterion is met [472.5 / ((14.87 / 100 ) +1 ) ^ 5] ~ $236 with a forecast high price ~$473 (no dividend).

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CTSH Stock Study (10-30-25)

Posted by on at 06:54 | Last modified: October 30, 2025 08:21

I recently studied Cognizant Technology Solns Corp. (CTSH, $71.69). Previous studies are here, here, here, and here.

M* writes:

     > Cognizant Technology Solutions is a multinational IT services provider
     > that offers a range of consulting and business process outsourcing
     > services. Originally founded in India, the company is headquartered in
     > the US and serves enterprise customers spanning the financial services,
     > healthcare, and resources industries. With most of its workforce
     > located in India, Cognizant leverages a global delivery model that
     > helps clients outsource their IT needs to offshore labor.

Over the past decade, this large-size company has grown sales and EPS at annualized rates of 5.3% and 7.0%. Lines are somewhat up, straight, and parallel with sales dips in ’20 and ’23 along with EPS rockiness from declines in ’16, ’17, ’19, ’20, and ’23. Five- (10-) year EPS R^2 is 0.62 (0.71) and Value Line (VL) gives an Earnings Predictability score of 95.

Over the past decade, PTPM leads peer and industry averages despite trending down from 17.4% (’15) to 14.9% (’24) with a last-5-year mean of 14.5%. ROE trails peer and industry averages, ranging from 12.2% in ’20 to 18.9% in ’18 with a last-5-year mean of 16.2%. Debt-to-Capital is much less than peer and industry averages while declining from 12.2% (’15) to 9.3% (’24) with a last-5-year mean of 11.1%.

Quick Ratio is 1.96 and Interest Coverage is 70 per M* who assigns “Narrow” Economic Moat, gives a “Standard” rating for Capital Allocation, and gives an A grade for Financial Health (per BI website). VL gives an A+ grade for Financial Strength.

With regard to sales growth:

My 4.0% per year forecast is below the range.

With regard to EPS growth:

My 6.0% forecast is below the long-term-estimate range (mean of seven: 9.2%). Initial value will be ’24 EPS of $4.51/share rather than 2025 Q2 EPS of $4.92 (annualized).

My Forecast High P/E is 18.0. Over the past 10 years, high P/E trends down from 26.3 (’15) to 18.3 (’24) with a last-5-year mean of 22.4 and a last-5-year-mean average P/E of 18.3. I am below the range.

My Forecast Low P/E is 12.0. Over the past 10 years, low P/E trends down from 19.1 (’15) to 14.1 (’24) with a last-5-year mean of 14.2. I am forecasting near bottom of the range [only ’22 is less (11.6)].

My Low Stock Price Forecast (LSPF) of $54.10 is default based on initial value given above. That is 24.5% less than the previous close and 17.0% less than the 52-week low.

Since a dividend is first issued in 2017, Payout Ratio (PR) ranges from 17.8% in ’17 to 34.2% in ’20 with a last-5-year mean of 26.3%. I am forecasting below the range at 17.0%.

These inputs land CTSH in the HOLD zone with a U/D ratio of 2.1. Total Annualized Return (TAR) is 9.6%.

PAR (using Forecast Average—not High—P/E) of 5.9% is less than I seek in a large-size company. If a healthy margin of safety (MOS) anchors this study, then I can proceed based on TAR instead.

To assess MOS, I compare my inputs with those of Member Sentiment (MS). Based on 73 studies done in the past 90 days (my study and 30 outliers excluded), averages (lower of mean/median) for projected sales growth, projected EPS growth, Forecast High P/E, Forecast Low P/E, and PR are 5.3%, 7.4%, 19.9, 13.9, and 26.1%. I am lower across the board. VL projects a future average annual P/E of 17.0, which is greater than MS (16.9) and greater than mine (15.0).

MS high / low EPS are $6.89 / $4.62 versus my $6.04 / $4.51 (per share). My high EPS is less due to a lower growth rate. VL’s high EPS is greatest at $7.25.

MS LSPF of $56.50 implies a Forecast Low P/E of 12.2 versus the above-stated 13.9. MS LSPF is 12.0% less than the default $4.62/share * 13.9 = $64.22, which results in more conservative zoning. MS LSPF remains 4.4% greater than mine.

I think MOS is solid in the study because my inputs are near or below analyst/MS estimates and historical ranges. In support is MS TAR (16.0%) exceeding mine by 6.4% per year.

With regard to valuation, PEG is 1.4 and 2.3 per Zacks and my projected P/E, respectively: slightly overvalued (1.68 per M*). Relative Value [(current P/E) / 5-year-mean average P/E] is somewhat cheap at 0.80.

Per U/D, CTSH is a BUY under $67.80/share. BI TAR criterion is met [108.7 / ((13.97 / 100 ) +1 ) ^ 5] ~ $56.50 with a forecast high price ~$109.

A 90-day free trial to BetterInvesting® may be secured here (also see link under “Pages” section at top right of this page).

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