Cass Information Systems Q4 profit rises on higher margins

Overview

• Payment management provider's Q4 net income rose 32.9% yr/yr, adjusted EPS up 38.8%

• Company consolidated Waste and Utility divisions into a single Facility division

• Company repurchased 201,450 shares at an average price of $40.59

Outlook

• Cass expects revenue tailwinds from onboarding new clients in 2026

• Company anticipates net interest margin expansion in future quarters

• Cass plans further stock repurchases to maintain leverage ratio of 10.00%

Result Drivers

• NET INTEREST INCOME - Increase of 20.9% in net interest income driven by improved net interest margin and higher average interest-earning assets

• FACILITY DOLLAR VOLUMES - Facility dollar volumes rose 13.0% due to onboarding of new clients and rising energy prices

• TRANSPORTATION DOLLAR VOLUMES - Increase in dollars per invoice due to higher freight rates and tariffs, despite lower invoice volumes

Key Details

Analyst Coverage

• The one available analyst rating on the shares is "buy"

• The average consensus recommendation for the business support services peer group is "buy"

• Wall Street's median 12-month price target for Cass Information Systems Inc is $45.00, about 4.8% above its January 21 closing price of $42.92

• The stock recently traded at 15 times the next 12-month earnings vs. a P/E of 13 three months ago

Press Release: ID:nBw4M5pH4a

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