Deluxe (NYSE:DLX) Trading Up 18.4% Following Strong Earnings

Key Points

• Deluxe Corporation's shares increased by 18.4% following the announcement of quarterly earnings, reporting an earnings per share (EPS) of $0.88, exceeding expectations of $0.71.
• The company declared a quarterly dividend of $0.30 per share, which equates to an annualized yield of 6.2%.
• Analysts have upgraded Deluxe from a "buy" to a "strong-buy" rating, while some have reduced their price targets for the stock.

Shares of Deluxe Corporation (NYSE:DLX - Get Free Report) were up 18.4% during trading on Thursday after the company announced better than expected quarterly earnings. The company traded as high as $19.14 and last traded at $18.99. Approximately 183,554 shares changed hands during trading, a decline of 51% from the average daily volume of 373,347 shares. The stock had previously closed at $16.03.

The business services provider reported $0.88 EPS for the quarter, topping analysts' consensus estimates of $0.71 by $0.17. Deluxe had a return on equity of 21.20% and a net margin of 2.64%. The firm had revenue of $521.30 million for the quarter, compared to analysts' expectations of $526.93 million. During the same period in the previous year, the firm posted $0.86 EPS. The business's revenue for the quarter was down 3.1% compared to the same quarter last year.

Deluxe Dividend Announcement

The company also recently disclosed a quarterly dividend, which will be paid on Tuesday, September 2nd. Investors of record on Monday, August 18th will be issued a $0.30 dividend. This represents a $1.20 dividend on an annualized basis and a yield of 6.2%. Deluxe's payout ratio is currently 96.00%.

Analyst Upgrades and Downgrades

DLX has been the subject of a number of recent analyst reports. Wall Street Zen upgraded shares of Deluxe from a "buy" rating to a "strong-buy" rating in a report on Friday, May 30th. TD Securities decreased their price objective on shares of Deluxe from $33.00 to $23.00 and set a "buy" rating for the company in a report on Thursday, May 1st.

Institutional Investors Weigh In On Deluxe

Hedge funds have recently added to or reduced their stakes in the stock. Nuveen LLC bought a new stake in shares of Deluxe during the 1st quarter valued at $5,281,000. Dimensional Fund Advisors LP grew its position in shares of Deluxe by 8.1% during the 4th quarter. Dimensional Fund Advisors LP now owns 2,361,658 shares of the business services provider's stock valued at $53,351,000 after acquiring an additional 177,534 shares during the period. Norges Bank bought a new position in Deluxe in the 4th quarter worth $3,210,000. Universal Beteiligungs und Servicegesellschaft mbH bought a new position in Deluxe in the 4th quarter worth $2,565,000. Finally, Kiker Wealth Management LLC bought a new position in Deluxe in the 2nd quarter worth $1,707,000. 93.90% of the stock is currently owned by hedge funds and other institutional investors.

Deluxe Price Performance

The company has a market cap of $864.56 million, a P/E ratio of 15.34, a P/E/G ratio of 0.47 and a beta of 1.49. The company has a debt-to-equity ratio of 2.34, a quick ratio of 0.84 and a current ratio of 0.93. The firm's fifty day moving average is $15.82 and its two-hundred day moving average is $16.45.

About Deluxe

Deluxe Corporation provides technology-enabled solutions to enterprises, small businesses, and financial institutions in the United States, Canada, and Australia. It operates through Merchant Services, B2B Payments, Data Solutions, and Print segments. The Merchant Services offers credit and debit card authorization and payment systems, as well as processing services primarily to small and medium-sized retail and service businesses.

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