Q3 Earnings Highlights: Donnelley Financial Solutions (NYSE:DFIN) Vs The Rest Of The Diversified Financial Services Stocks

The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Donnelley Financial Solutions (NYSE:DFIN) and the rest of the diversified financial services stocks fared in Q3.

Diversified financial services encompass specialized offerings outside traditional categories. These firms benefit from identifying niche market opportunities, developing tailored financial products, and often facing less direct competition. Challenges include scale limitations, regulatory classification uncertainties, and the need to continuously innovate to maintain market differentiation against larger competitors expanding their offerings.

The 10 diversified financial services stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 3% while next quarter’s revenue guidance was in line.

While some diversified financial services stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 2.4% since the latest earnings results.

Donnelley Financial Solutions (NYSE:DFIN)

Born from the need to navigate increasingly complex financial regulations in the digital age, Donnelley Financial Solutions (NYSE:DFIN) provides software and technology-enabled services that help companies comply with SEC regulations and manage financial transactions and reporting requirements.

Donnelley Financial Solutions reported revenues of $175.3 million, down 2.3% year on year. This print exceeded analysts’ expectations by 3.3%. Overall, it was an exceptional quarter for the company with a beat of analysts’ EPS and revenue estimates.

Donnelley Financial Solutions delivered the slowest revenue growth of the whole group. Unsurprisingly, the stock is down 4.7% since reporting and currently trades at $49.28.

Is now the time to buy Donnelley Financial Solutions? Access our full analysis of the earnings results here, it’s free for active Edge members.

Best Q3: Paymentus (NYSE:PAY)

Founded in 2004 to simplify the complex world of bill payments, Paymentus (NYSE:PAY) provides a cloud-based platform that helps utilities, municipalities, and service providers automate billing and payment processes.

Paymentus reported revenues of $310.7 million, up 34.2% year on year, outperforming analysts’ expectations by 10.7%. The business had a stunning quarter with a solid beat of analysts’ revenue estimates and an impressive beat of analysts’ EBITDA estimates.

Paymentus pulled off the fastest revenue growth among its peers. The market seems happy with the results as the stock is up 20.4% since reporting. It currently trades at $34.45.

Is now the time to buy Paymentus? Access our full analysis of the earnings results here, it’s free for active Edge members.

Weakest Q3: NCR Atleos (NYSE:NATL)

Spun off from NCR Voyix in 2023 to focus exclusively on self-service banking technology, NCR Atleos (NYSE:NATL) provides self-directed banking solutions including ATM and interactive teller machine technology, software, services, and a surcharge-free ATM network for financial institutions and retailers.

NCR Atleos reported revenues of $1.12 billion, up 4.5% year on year, exceeding analysts’ expectations by 0.6%. Still, it was a softer quarter as it posted a significant miss of analysts’ EPS estimates.

As expected, the stock is down 9.8% since the results and currently trades at $34.12.

Read our full analysis of NCR Atleos’s results here.

Euronet Worldwide (NASDAQ:EEFT)

Operating a global network of over 47,000 ATMs and 821,000 point-of-sale terminals across more than 60 countries, Euronet Worldwide (NASDAQ:EEFT) provides electronic payment solutions including ATM services, prepaid product processing, and international money transfer services.

Euronet Worldwide reported revenues of $1.15 billion, up 4.2% year on year. This result came in 4.5% below analysts' expectations. It was a softer quarter as it also logged a significant miss of analysts’ EFT Processing segment estimates and a significant miss of analysts’ Money Transfer segment estimates.

Euronet Worldwide had the weakest performance against analyst estimates among its peers. The stock is down 21.2% since reporting and currently trades at $69.89.

Read our full, actionable report on Euronet Worldwide here, it’s free for active Edge members.

WEX (NYSE:WEX)

Originally founded in 1983 as Wright Express to serve the fleet card market, WEX (NYSE:WEX) provides payment processing and business solutions across fleet management, employee benefits, and corporate payments sectors.

WEX reported revenues of $691.8 million, up 4% year on year. This print beat analysts’ expectations by 1.5%. More broadly, it was a satisfactory quarter as it also produced a solid beat of analysts’ Account Servicing segment estimates but a slight miss of analysts’ Payment Processing segment estimates.

The stock is down 11.9% since reporting and currently trades at $135.67.

Read our full, actionable report on WEX here, it’s free for active Edge members.

Market Update

As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.

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