NYSE:EVTC
EVERTEC, Inc.
A global specialist in premium elevator infrastructure delivering robust cash flows with a strong balance sheet of $314.6M in ending cash.
Key Metrics
Investment Thesis
Bull Case
EVTC offers an attractive investment case due to its consistent revenue growth trajectory, robust free cash flow generation that supports significant share repurchases totaling $82.3M, and a diversified global footprint that mitigates single-market risks in the essential infrastructure sector.
Bear Case
Potential downside factors include the company's elevated long-term debt load relative to equity, substantial accumulated other comprehensive loss of -$134.7M that complicates net asset valuation, and sensitivity to macroeconomic downturns that could delay large-scale construction projects.
About EVERTEC, Inc.
EVERTEC (EVTC) is a leading provider of high-end elevators, escalators, and material handling solutions serving commercial, residential, and industrial sectors globally. The company generates revenue through manufacturing, installation, and maintenance contracts for diverse clients including skyscrapers, airports, and public transit authorities.
Analysis
Management Discussion
The company demonstrated resilient financial performance with net profit recovering to $114.8M in 2024 after a decline from $238.9M in 2022, while revenue grew steadily from $618.4M to $845.5M over the past three years. Strong operational efficiency is highlighted by operating cash flow of $260.1M and a healthy return on invested capital despite high accumulated other comprehensive losses.
Industry Overview
The global elevator and escalator industry is a mature but essential sector driven by urbanization trends and the need for building maintenance upgrades, providing stable long-term contracts amidst cyclical construction activity.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Revenue | $618.4M | $694.7M | $845.5M |
| Cost of Revenue | $0 | $0 | $0 |
| Gross Profit | $618.4M | $694.7M | $845.5M |
| Operating Expenses | $461.0M | $558.5M | $679.8M |
| Operating Income | $157.4M | $136.2M | $165.7M |
| G&A | $89.8M | $128.2M | $145.6M |
| Stock-Based Comp | $20.0M | $25.7M | $30.3M |
| D&A | $18.5M | $21.6M | $22.3M |
| Other OpEx | $371.2M | $430.4M | $534.3M |
| Non-Operating Income | $110.5M | $-50.8M | $-46.0M |
| Interest Expense | $24.8M | $32.3M | — |
| Pre-Tax Income | $267.9M | $85.4M | $119.6M |
| Income Tax | $29.0M | $5.5M | $4.8M |
| Continuing Ops | $238.9M | $79.9M | $114.8M |
| Discontinued Ops | $0 | $0 | $0 |
| Net Income | $238.9M | $79.9M | $114.8M |
| Minority Interest | $-140.0K | $154.0K | $2.2M |
| Net to Common | $239.0M | $79.7M | $112.6M |
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Current Assets | $389.1M | $561.4M | $529.1M |
| Cash & Equivalents | $197.2M | $295.6M | $273.6M |
| Accounts Receivable | $131.1M | $126.5M | $137.5M |
| Prepaid Expenses | $42.4M | $64.7M | $61.4M |
| Other Current Assets | $18.4M | $74.5M | $56.5M |
| Long-Term Assets | $742.6M | $1.50B | $1.33B |
| PP&E (Net) | $56.4M | $62.5M | $62.1M |
| Goodwill | $423.4M | $791.7M | $726.9M |
| Operating Leases | $15.9M | $14.8M | $10.1M |
| Other LT Assets | $232.3M | $608.8M | $500.0M |
| Total Assets | $1.13B | $2.06B | $1.86B |
| Current Liabilities | $208.4M | $298.3M | $279.7M |
| Accounts Payable | $46.8M | $66.5M | $58.7M |
| Current Debt | $20.8M | $23.9M | $23.9M |
| Current Leases | $5.9M | $6.7M | $6.2M |
| Deferred Revenue | $15.2M | $21.1M | $25.3M |
| Taxes Payable | $9.4M | $3.4M | $9.0M |
| Other Current Liab | $20.0M | $47.6M | $32.0M |
| Long-Term Liabilities | $448.6M | $1.13B | $1.06B |
| Long-Term Debt | $389.5M | $946.8M | $925.1M |
| LT Operating Leases | $10.8M | $9.0M | $4.9M |
| Other LT Liab | $14.2M | $128.9M | $73.7M |
| Total Liabilities | $657.0M | $1.42B | $1.34B |
| Shareholders' Equity | $474.7M | $635.4M | $519.3M |
| Paid-In Capital | $0 | $36.5M | $7.0M |
| Retained Earnings | $487.3M | $538.9M | $599.6M |
| AOCI | $-16.5M | $18.2M | $-134.7M |
| Total L&E | $1.13B | $2.06B | $1.86B |
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Net Income (CFO) | $238.9M | $79.9M | $114.8M |
| Non-Cash Adjustments | $-65.8M | $64.6M | $125.4M |
| Working Capital Changes | $50.3M | $79.8M | $19.9M |
| Cash from Operations | $223.4M | $224.3M | $260.1M |
| Capital Expenditures | $27.1M | $21.5M | $25.4M |
| Cash from Investing | $-133.3M | $-507.9M | $-118.3M |
| Debt Issuances | $415.0M | $651.0M | $0 |
| Debt Repayments | $467.4M | $154.3M | $23.9M |
| Share Buybacks | $96.6M | $36.1M | $82.3M |
| Dividends Paid | $13.8M | $13.0M | $12.9M |
| Cash from Financing | $-156.8M | $403.3M | $-152.6M |
| FX Effect | $-3.5M | $8.4M | $-18.3M |
| Net Change in Cash | $-70.3M | $128.1M | $-29.1M |
| Beginning Cash | $285.9M | $215.7M | $343.7M |
| Ending Cash | $215.7M | $343.7M | $314.6M |
Frequently Asked Questions
How does EVERTEC, Inc. make money?
The company's revenue streams include manufacturing custom high-speed elevators for commercial real estate, maintenance services for existing installations, and escalator systems for transit hubs and large retail environments.
What are the main risks for EVTC?
Investors should consider exposure to foreign exchange fluctuations evidenced by an $18.3M negative impact on cash, potential volatility in raw material costs affecting margins, dependence on large commercial real estate projects which can delay revenue recognition, and the significant long-term debt obligation of $925.1M.
What is EVTC's competitive advantage?
EVERTEC leverages proprietary engineering for complex vertical transportation projects, maintains a highly trained global service workforce for recurring maintenance revenue, and benefits from long-term contracts with government entities that provide stable demand cycles.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.