Shares in Jack Henry & Associates Inc. rose slightly last week after the banking technology vendor singled out payments as a driver for its strong earnings.
The Monett, Mo., company said after the markets closed Wednesday that net income in its fiscal second quarter, which ended Dec. 31, climbed 28% from a year earlier, to $27.8 million, or 30 cents a share, which beat the average Wall Street estimate by 4 cents. Revenue rose 13%, to $167.2 million.
Jack Prim, the chief executive of Jack Henry, said in a press release that payments operations played an important role in those results. “We continue to generate significant growth in all of our business lines that provide electronic transaction processing.”
Gil Luria, an analyst with Wedbush Morgan Securities, raised his fiscal 2007 earnings estimate for Jack Henry by 7 cents, to $1.16 a share, and his stock price target by $3, to $23. He cited the strength of its payments capabilities.
“We are slightly more optimistic regarding Jack Henry’s growth potential as fast-growing electronic payment revenue becomes material,” Mr. Luria wrote in a research note issued Thursday.
Jack Henry’s stock closed Friday at $22.80, up 1.2% from Wednesday’s close.
