Nuvei Posts Better-Than-Expected 1Q Results; Shares Pop 7%

Shares of Nuvei Corp. (NVEI) jumped almost 7% in early trading Monday after the company beat earnings and revenue estimates in its first quarter. The global payment technology partner performance was driven by growth in the volume of existing merchant customers and an acceleration in the number of new customers.

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Indeed, total volume increased 132%, from $8.9 billion to $20.6 billion. E-commerce accounted for around 87% of the total volume.

Nuvei’s revenue for 1Q 2021 came in at $149.9 million, an increase of 80% from a revenue of $83.2 million reported in 1Q 2020, beating estimates by $9.37 million.

Meanwhile, the company reported a profit of $27.8 million ($0.19 per share) in 1Q 2021, compared to a loss of $62.3 million ($-0.74 per share) in 1Q 2020. Adjusted EBITDA increased 97% from $33.3 million to $65.5 million.

On an adjusted basis, Nuvei earned $0.35 per diluted share for its most recent quarter compared with an adjusted profit of $0.11 per diluted share in the prior-year period. Adjusted profit was higher than analysts’ expectations of $0.32.

Nuvei’s Chair and CEO Philip Fayer said, “Our focus on building leading-edge solutions to facilitate and help our clients best connect with their clients continued during the first quarter as we expanded our reach with new markets, added multiple alternative payment methods (“APMs”) and introduced new capabilities like supporting payment in cryptocurrencies. These initiatives, coupled with significant volume growth from current and new clients, position us extremely well to drive our overall performance and growth this year and into the future. We are proud of our results and raising our financial outlook for the full year 2021.”

Nuvei has announced agreements to acquire Mazooma Technical Services, and more recently, SimplexCC. (See Nuvei Corp. stock analysis on TipRanks)

Last week, Scotiabank analyst Paul Steep reiterated a Buy rating on NVEI while raising its price target to C$101.00 from C$97.00 for a 20.4% upside potential. Steep sees the Simplex acquisition favorably. He believes this acquisition will be positive given Nuvei’s plan to increase its market share in the alternative payments industry.

Overall, NVEI scores a Strong Buy consensus rating among analysts based on 6 Buys and 1 Hold. The average analyst price target of C$96.49 implies a 15% upside potential to current levels.