SQ - Shift4: Deal's Off. Here's What's Next
2024-03-19 09:05:22 ET
Summary
- Shift4's is on a fast track, with revenue and EPS making leaps.
- Despite its growth, Shift4's stock price looks undervalued.
- Shift4 is a good buy regardless of the CEO's decision to look for a buyout, as it is a solid company with a low valuation and strong fundamentals.
Investment Thesis
Normally, companies get hammered when they miss Wall Street estimates. This wasn't the case for Shift4 ( FOUR ) when it released Q4 and FY 2023 results last month. Not only did the market give it a pass, but its ticker was up about 8%. And we're not talking about a small miss here. Q4 sales came at $705 million vs. $757 million estimate, while normalized EPS stood at $0.76, a whole 6% short of Wall Street's $0.81 consensus. To be fair, shares dipped during pre-market hours, but that's when Wall Street's wildcatters are swinging prices on low volumes. When the market opened, Shift4 recovered pre-market losses in less than an hour and continued an upward trend throughout the day....
Shift4: Deal's Off. Here's What's Next