Digital payments and payments processing is a popular area in technology. Multiple fintech companies have sprung up over the past decade. However, most of them are consumer-facing. Some companies like ACI Worldwide handle mission-critical payment transactions for large clients like financial institutions, merchants, and corporations. That niche has high volumes as well as scale. ACI Worldwide has long-term relationships with such “blue chip” clients, and the renewal rates for such contracts also tend to be high. Institutions want only the trusted names to handle such sensitive processes. Therefore, it is not easy for a new competitor to gain a foothold. Such competitive advantages make ACI Worldwide one of the top tech stocks to invest in now.
ACI Reports Its 4Q2020 Earnings Results
ACI Worldwide reported its fourth-quarter 2020 earnings results on 25th February 2021. The quarter’s total revenue was $304.5 million, marginally above the $300.5 million achieved in Q42019. Net adjusted EBITDA margins improved from 48% in Q42019 to 51% in Q42020. Net income rose from $55.5 million to $67.1 million. If you are looking for technology stocks to buy, then these Q4 results make ACI a candidate worth looking into.
Company CEO Odilon Almeida said, “Our adjusted EBITDA grew 17%, and our net adjusted EBITDA margin grew more than 450 basis points. We chose our focus on shareholder value creation. Further, our consolidated new bookings grew 36%, and in particular, under Eve Aretakis’s management, our Demand segment bookings more than doubled. These results positioned the company extremely well to achieve our organic growth goals in the coming years.”
ACI Worldwide has had steady growth over the last five years. Its stock has doubled in price, from around $20 in early 2016 to $40 in March 2021. ACI does not pay a dividend as of March 2021. The stock’s 1-year return has been quite strong at around 78%.