Jack Henry & Associates Shows Potential for Accelerating Long-Term Revenue Growth, Margin Expansion, RBC Says

MT Newswires Live06-19

Jack Henry & Associates (JKHY) shows potential for accelerating long-term revenue growth as well as margin expansion, which could drive a re-rating of the company's stock higher, RBC Capital Markets said in a note emailed Thursday.

Noting that the company has reported 43 new core deals through fiscal Q3, RBC said it estimates that an incremental 100+ core wins over the next several years, above the annual run-rate of about 50 per year, could add between $60 million to $80 million in incremental core revenues.

Additionally, the company's management expects small and medium-sized business to become the fastest-growing and second-largest revenue component within Payments by fiscal 2028, RBC noted, adding that this could push the company's revenue growth to over 8% from 7% in fiscal 2028 to 2029.

RBC lowered its price target on the company's stock to $173 from $180 driven by a broader fintech re-rating and maintained its outperform rating.

Price: 124.65, Change: +0.43, Percent Change: +0.35

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