Here is Why Growth Investors Should Buy Shift4 Payments (FOUR) Now

Zacks Investment Research recommends Shift4 Payments (FOUR) as a growth stock, citing a Growth Score of B and a Zacks Rank #2 (Buy). Shift4 Payments' appeal is driven by a projected EPS growth of 43.5% this year, significantly exceeding the industry average of 10.4%, and a current cash flow growth of 38.8% versus an industry average of 4.3%; additionally, current-year earnings estimates have surged 20.2% over the past month.

Analysis

Shift4 Payments (FOUR) is presented as a compelling growth investment opportunity, underscored by a Zacks Rank #2 (Buy) and a Growth Score of B. The company's financial outlook is highlighted by a projected earnings per share (EPS) growth of 43.5% for the current year, significantly outperforming the industry average expectation of 10.4%. While its historical EPS growth stands at 138.8%, the emphasis is on this robust forward-looking projection. Complementing the earnings outlook, Shift4 Payments demonstrates strong cash flow dynamics, with current year-over-year cash flow growth reported at 38.8%, substantially exceeding the industry's 4.3%. This is further supported by an impressive annualized cash flow growth rate of 119.9% over the past 3-5 years, compared to an industry average of 12.9%. A key positive indicator is the recent upward trend in earnings estimate revisions; the Zacks Consensus Estimate for Shift4 Payments' current-year earnings has increased by 20.2% over the past month, a factor often correlated with positive near-term stock price movements. According to the source, stocks combining a strong Zacks Rank and a favorable Growth Score, like FOUR, have historically shown a tendency to outperform the market, though it also acknowledges the inherent above-average risk and volatility associated with growth stocks.

Key Decisions for Investors

• Investors with a growth-focused mandate may find Shift4 Payments (FOUR) warrants further investigation due to its strong projected EPS and cash flow growth, positive earnings estimate revisions, and favorable Zacks ratings.
• Close monitoring of the company's actual earnings and cash flow performance against its high growth projections, particularly the 43.5% EPS growth target, is advisable to validate the ongoing investment thesis.
• Considering the inherent volatility typically associated with growth stocks, investors should evaluate their individual risk tolerance and how FOUR's profile fits within their diversified portfolio strategy, despite the positive indicators presented.