Topic: Growth Stocks

Stock Pickers Digest Hotline – Friday, February 28, 2014

Article Excerpt

ACI WORLDWIDE INC., $59.84, symbol ACIW on Nasdaq, makes software that processes transactions involving credit cards, debit cards, automated teller machines, point-of-sale terminals and interbank payments. Its products also help cut fraud. In the quarter ended December 31, 2013, ACI’s revenue rose 26.4%, to $283.2 million from $224.1 million a year earlier. That’s mainly due to contributions from two acquisitions it made in 2013: Online Resources Corp., which it bought for $126.6 million, and Official Payments Holdings ($109.0 million). These moves helped ACI further expand into online banking and bill payments. Earnings per share rose 3.2% to $1.30 from $1.26. ACI holds cash of $95.1 million, or $2.47 a share. Its long-term debt of $708.1 million is a reasonable 31% of its market cap. The company’s outlook is positive, and the stock trades at 25.0 times the $2.40 a share that ACI will likely earn this year. That’s not unreasonable for a company with ACI’s growth potential, but any problems integrating its recent…