Susquehanna downgrades Evertec to “Negative”

Susquehanna has downgraded the shares of Evertec Inc (NYSE: EVTC) to “Negative” from “Neutral”, as it cited margin pressure.

The firm also revised down its 12-month price target on the stock to $28.00 from $38.00.

“Appropriately, the company has been expanding its Total Addressable Market beyond its heritage relationship with its former parent Banco Popular and is traveling outside the borders of its native Puerto Rico. But SFG believes this transition is likely to pressure margins, potentially moving below levels contemplated by consensus,” Susquehanna analysts wrote in a note to clients.

“EVTC is likely to face negative leverage over the next few years, with its lowest margin region – Latam – growing fastest,” they added.

Stock Performance

The shares of Evertec Inc (EVTC) closed 5.28% ($1.78) lower at $31.95 in New York on Thursday, as they reversed a small gain from the previous market session.

It has been the lowest closing price for the stock since July 10th.

The company’s total market cap now stands at $2.044 billion.

The shares of Evertec Inc (EVTC) went up 26.44% in 2023, compared with a 10.99% gain for the benchmark index, NYSE Composite (NYA).

The company’s shares have retreated 21.96% so far this year.