Total System Services: Shares Appear Relatively Fairly Valued, Says Oppenheimer

In a research report issued today, Oppenheimer analyst Glenn Greene maintained a Perform rating on Total System Services (NYSE:TSS). No price target was provided.

Greene said, “TSS reported solid 3Q14 results with notable segment margin strength. Pre- reimbursable revenue exceeded our estimate by $10M, with upside across segments, except NetSpend, which disappointed again. TSS pre-reimbursable revenue grew 8.5% Y/Y to $553M (vs. our ~$543M estimate). North American revenue growth accelerated to 11% and could ramp further in FY15, although the BofA conversion now appears delayed until early FY15. Encouragingly, TSS maintained its FY14 revenue/EPS guide (though expect low-end) and moderated EBITDA expectations to reflect continued softness in Merchant, disappointing NetSpend growth, and large conversion delay. Shares appear relatively fairly valued, in our view, at ~9x our FY15E EBITDA, and accordingly we maintain our Perform rating.”

According to, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Glenn Greene has a total average return of 18.9% and a 83.3% success rate. Greene has a average return when recommending TSS, and is ranked #227 out of 3350 analysts.

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