(CATM) Cardtronics Incorporated – Solid Growth

Cardtronics (CATM) set records for revenue and cash flows leaving analysts optimistic about the company’s growth prospects.

Company Description

Cardtronics operates over 30,000 ATMs in the U.S., Puerto Rico, the U.K. and Mexico. Additionally, the company works with merchants like 7-Eleven, Costco, CVS, and other major retailers and gas stations.

Rising Revenue

On Feb 11 Cardtronics reported fourth-quarter results that included revenue of $125 million, up 6% since the same period last year. The company also managed to improve its gross margin by 700 bps, to 31%.

Net income came in at just under $7 million, or 17 cents per share. This did fall a penny shy of expectations.

Chairman – “Outstanding Year”

Fred Lummis, Chairman of the Board said “2009 was truly an outstanding year for Cardtronics.” He went on to highlight the record revenue and cash flows, that allowed the company to lower its debt ratios, strengthening the balance sheet.

Solid Growth

After the report, most Cardtronics analysts raised full-year estimates. The Zacks Consensus Estimate for 2010 is up a penny to 77 cents. If met, this would be a growth rate of 40%.

Next year’s projection is also up 1 penny, to 95 cents for a growth rate of 13%.


Cardtronics has nice growth projections but remains a good value too. The forward P/E is less than 13 times and shares carry a PEG ratio of 0.9. CATM’s price-to-sales ratio is 0.8 times.

The Chart

The earnings miss sent shares sharply lower, but if you are looking to do some bottom fishing this Zacks Rank #1 stock is a solid candidate. The decline gives Cardtronics great value and the chart looks to be leveling off.

A chart for Cardtronics

Bill Wilton is the Growth Stock Strategist for Zacks.com. He is also the Editor in charge of the market-beating Zacks Growth Trader service

Zacks Investment Research

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