EVERTEC, Inc. (EVTC): A Bull Case Theory

We came across a bullish thesis on EVERTEC, Inc. on CompanyCharts’s Substack. In this article, we will summarize the bulls’ thesis on EVTC. EVERTEC, Inc.'s share was trading at $29.25 as of January 29th. EVTC’s trailing P/E was 12.71 according to Yahoo Finance.

EVERTEC, Inc. provides transaction processing and financial technology services in Latin America, Puerto Rico, and the Caribbean. EVTC currently trades at notably low valuation multiples compared with its peers, with a price-to-sales ratio of 2.11, price-to-gross-profit of 4.23, price-to-earnings of 13.04, price-to-equity of 3.31, price-to-cash-flow-from-operations of 8.21, and price-to-free-cash-flow of 9.04. Despite these modest valuations, the company exhibits a strong foundation for growth, as long-term averages suggest it can achieve roughly 10% revenue growth, 11% EPS growth, and 6–7% free cash flow expansion.

This combination of low multiples and consistent operational performance creates an appealing risk/reward profile. The current market pricing appears to have largely reflected the downside, leaving potential upside tied to both a return to normalized sentiment and continued organic growth. EVTC exemplifies a “boring but consistent” setup, where the underlying business steadily compounds value while the market undervalues the story, creating opportunities for patient investors.

If the per-share trailing twelve-month trends persist, investors may benefit from both multiple expansion and the company’s inherent growth, providing a compelling scenario where downside risk is limited and upside potential is meaningful.

This makes EVTC particularly interesting for those seeking steady, long-term compounding at an attractive entry point, as the market currently underestimates the durability and predictability of its performance. Overall, EVTC offers a unique opportunity where cheap pricing meets consistent operational growth, presenting an investment case that balances safety with the potential for outsized returns as sentiment and fundamentals converge.

Previously we covered a bullish thesis on Fiserv, Inc. (FI) by David in October 2024, which highlighted the company’s sticky customer relationships, diversified Fintech, Payments, and Acceptance segments, and strategic acquisitions driving long-term growth. The company's stock price has depreciated approximately by 68.65% since our coverage. This is because the thesis didn’t fully play out. The thesis still stands as FI’s operational resilience remains key. EVERTEC, Inc. (EVTC) shares a similar perspective but emphasizes low valuation multiples and consistent growth in Latin America and the Caribbean.

EVERTEC, Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 23 hedge fund portfolios held EVTC at the end of the third quarter which was 21 in the previous quarter. While we acknowledge the potential of EVTC as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.