预计强劲趋势将继续

23 October 2018Payments, Processors, & IT ServicesWorldpayRatingBuyValuation & RisksTMTPayments, Processors, &IT ServicesPrice at 22 Oct 2018 (USD)95.02Price target100.0052-week range101.82 - 68.01ResultsNorth AmericaUnited StatesCompanyWorldpayReutersBloombergExchangeTickerWP.NWP USNYSWPDate23 October 2018Deutsche BankResearchExpecting Robust Trends to ContinueLooking for acceleration in organic cc growthOn Nov 8 before the open, we est. WP to report 3Q18 revs of $1,020m (+9.1%Y/Y) and adj. EPS of $1.03 compared to WP’s guidance of $1,000-$1,020m(+7-9% Y/Y) and $1.00-$1.03, respectively. After seeing solid acceleration inorganic cc growth in 2Q18 (+8% from +7% in 1Q18), we believe WP is scheduledfor a continuation (DBe +9%) led by its global eCommerce capabilities (believe~20% growth is reasonable) and continued improvement in Issuer Solutions andMerchant Solutions. In addition, we believe the 2018 cost synergy target of$50m could again potentially be raised (as well as the $200m long-term target).While we are monitoring competitive, FX, and regulatory developments (e.g. UKPSR review to end in 2019) we believe WP is well positioned given its global,multicurrency scale (eComm differentiator). Buy.Technology Solutions driven by eCommerce cross-sellsWe est. Technology Solutions revs of $423m (+17.5% Y/Y) as continuedeCommerce strength is helping offset tough comps in Integrated. Recall, this isthe first quarter excluding Paymetric (2Q18 growth was ~17% organic cc), and weexpect a high-teens organic cc growth rate. eComm is a significant growth lever(WP called out its first two cross-sell wins in 2Q18) and cross-sells have a largerunway to go with an incremental cross-sell volume TAM of $300bn. While WP isonly servicing 15% of volumes at the top 21 global eComm companies currently,the pipeline of new global wins is strong as well as the opportunity to gain walletshare while moving down market into the SMB space over time. Integrated willonce again face tough comps but should be able to sustain mid-teens growth, inour view, as the company continues building out cross-sell capabilities in the UK.Expecting Merchant and Issuer Solutions to continue turnaroundWe est. Merchant Solutions revs of $506m (+3.9% Y/Y), which is a slightdeceleration from +5.3% growth in 2Q18 but only due to FX (200bps tailwindlast qtr vs. expectations for no impact this qtr). In the US, the strong macroenvironment is leading to higher ticket size, which is leading to better SSSamongst large merchants while the Merchant Bank and ISO growth sustainstrong growth. In the UK (~15% of total net revs), the company has implementedsome pricing changes to pass along higher scheme fees (began 2Q18) while newmanagement should help resuscitate growth. We est. Issuer Solutions revs of$91m (+3.7% Y/Y) as new logo wins from a combined entity and cross-sell ofvalue added services accelerate while the company has fully lapped the CapitalOne deconversion that partially weighed on 2Q18.Bryan KeaneResearch Analyst+1-415-617-4246Korey MarcelloResearch Associate+1-904-527-6235Mahesh DassResearch Associate+1-415-617-2842Deutsche Bank Securities Inc.Deutsche Bank does and seeks to do business with companies covered in its research reports. Thus, investors should beaware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should considerthis report as only a single factor in making their investment decision. DISCLOSURES AND ANALYST CERTIFICATIONSARE LOCATED IN APPENDIX 1. MCI (P) 091/04/2018.Distributed on: 24/10/2018 01:03:46 GMT7T2se3r0Ot6kwoPaProvided for the exclusive use of Research Research at Provisional Access on 2018-10-24T05:16+00:00. DO NOT REDISTRIBUTE 23 October 2018Payments, Processors, & IT ServicesWorldpayAwaiting further color on long-term accretion targetsWe est. adj. EBITDA margins of 49% (+170bps Y/Y) as the company benefitsfrom continued cost synergies (already tracking at $48m annual run rate exiting2Q18) and natural operating leverage in the model (accounted for ~25% of marginexpansion in 2Q18). In addition, WP provided line of sight to $100m in revsynergies (primarily from eComm) and $200m in cost synergies exiting 2020,which we expect to be conservative. Rev synergies exclude potential for newlogos as a result of the merger – the company has already signed a few acrossbusiness segments that are beginning to flow through (e.g. Issuer Solutionsbenefitted from new logos). In addition, cost synergies exclude the migration fromWPG’s legacy eComm platform to its new one (expected to be complete beforethe acquisition) while the 2019 cost synergies should be easily achievable withthe US platform consolidation.Page 2Deutsche Bank Securities Inc.Provided for the exclusive use of Research Research at Provisional Access on 2018-10-24T05:16+00:00. DO NOT REDISTRIBUTE 23 October 2018Payments, Processors,