FleetCor Technologies (NYSE:FLT)

CAPS Rating: 5 out of 5

Results 1 - 10 of 10

Recs

1
Member Avatar TMFPencils (99.83) Submitted: 2/9/2015 4:14:55 PM : Outperform Start Price: $146.77 FLT Score: +0.71

Still researching FleetCor, but I see the makings of a company/stock that has good odds to continue beating the market in the coming years:

** FleetCor provides payment solutions (fuel cards) -- workforce payment products -- for commercial operators around the world (including major oil companies, commercial fleets, government entities, and more), processing 651 million transactions in 2014. The company, however, offers multiple services (security protection, fleet management, and more) which reduces its dependence on higher fuel prices to generate revenue.

** FleetCor has an extensive network of merchants, partners, and other customers -- its payment networks cover thousands of fueling sites and other locations (like lodging and food) around the world. Classic network effect at play: the more locations FleetCor has in its network (e.g. the more sites where FleetCor's payment solutions are accepted), the more attractive FleetCor's solutions will be to potential clients. Think of it as a MasterCard or Visa for commercial clients (FleetCor actually has a partnership with MasterCard), particularly in the energy/fleet industry.

** Sales have grown at a pace of 32.2% annually over the past three years, with earnings growing 35.8% annually over the same period. 2015 will bring some headwinds with currency impact and lower oil prices, but the company should still grow earnings at a 17%+ rate for the year.

** This company is a true cash flow machine. Seriously. In 2014 capital expenditures were just $27.1 million and operating cash flow was a stellar $608.3 million. The company is plowing a lot of cash into acquisitions ($2.5 billion in 2014 thanks to the large Comdata acquisition) -- which could be a risk if an acquisition/integration goes sour -- but FleetCor's operating cash flow production has more than quadrupled since 2012.

** Leadership is very experienced. Chairman and CEO Ronald Clarke has been with the company since 2000. CFO Eric Dey has been with FleetCor since 2002. The Glassdoor ratings aren't that great (possibly because of numerous acquisitions over the years), unfortunately, so that will be something to watch going forward.

** Gross margin is at an all-time high at 77.5%. ROE has been above 18% since the company went public.

FleetCor is becoming a global force -- largely through acquisitions combined with organic expansion -- when it comes to offering workforce payment and various fleet management solutions for commercial enterprises. The company has a solid record of growth over the past several years, is churning out significant free cash flow (excluding acquisition costs), and seems to be in a position to continue growing in the coming years. The P/FCF multiple is a very reasonable 22, the lowest it has been in roughly two years.

The company's ability to successfully integrate its numerous acquisitions into the core business is the key thing to watch going forward. I like management's track record in this area so I'm going to call this an outperform on CAPS. The stock will probably be volatile considering the macro issues at play, but I like the competitive position FleetCor is in for the long haul. This is a strong operator extending its scale and network through global acquisitions, with consistent (and quickly growing) free cash flow production to boot. Outperform.

Recs

0
Member Avatar tripleking (66.71) Submitted: 6/17/2014 10:21:35 AM : Outperform Start Price: $133.20 FLT Score: +5.82

good stock

Recs

0
Member Avatar luremaster (39.42) Submitted: 5/20/2014 2:24:33 AM : Outperform Start Price: $120.93 FLT Score: +13.79

solid execution

Recs

0
Member Avatar JoeBEan769 (87.21) Submitted: 12/15/2013 12:31:56 PM : Outperform Start Price: $118.91 FLT Score: +9.96

Playing the credit card industry through trucking.

Recs

0
Member Avatar 2008Rehab (21.17) Submitted: 11/14/2013 6:25:19 AM : Outperform Start Price: $117.18 FLT Score: +11.54

It's been going up for a long time.

Recs

0
Member Avatar TMFTypeoh (82.61) Submitted: 10/26/2013 12:35:31 PM : Outperform Start Price: $109.74 FLT Score: +18.40

Forbes 50 best growth companies.

Recs

1
Member Avatar PhilipS (68.17) Submitted: 9/18/2013 8:51:50 AM : Outperform Start Price: $109.57 FLT Score: +15.28

As an issuer and processor of fuel-payment cards to the trucking industry, FleetCor remains a rather low-key way to capitalize on the strong 'payment solutions' trend happening across the world. FleetCor also remains a nice play on rising oil prices, as higher costs at the pump lead to increased revenue for the company, which receives a percentage of every sale made on one of its cards.

Recs

0
Member Avatar chutterdude (< 20) Submitted: 9/14/2013 9:41:06 PM : Outperform Start Price: $108.82 FLT Score: +16.32

The next Visa - high upside.

Recs

0
Member Avatar scrubs62074 (69.35) Submitted: 2/8/2013 3:47:47 PM : Outperform Start Price: $65.85 FLT Score: +90.02

High Volume Breakout on 02/08/13

Recs

0
Member Avatar vejo1 (< 20) Submitted: 12/30/2012 10:26:07 AM : Outperform Start Price: $52.65 FLT Score: +134.85

This global company has solid fundamentals, handles payments for the booming petroleum industry.

Results 1 - 10 of 10

Featured Broker Partners


Advertisement