Jack Henry & Associates, Inc.(JKHY) provides technology solutions and payment processing services primarily for financial services organizations in the United States. The company offers information and transaction processing solutions for banks ranging from community to multi-billion dollar institutions under the Jack Henry Banking brand; core data processing solutions for various credit unions ; and specialized financial performance, imaging and payments processing, information security and risk management, retail delivery, and online and mobile solutions to financial institutions. It also provides a suite of integrated applications required to process deposit, loan, and general ledger transactions, as well as to maintain centralized customer/member information; and complementary products and services.
The Jack Henry Banking business brand provides SilverLake, a robust IBM Power System primarily designed for commercial-focused banks; CIF 20/20, a system for the community bank market; and Core Director, a Windows-based client/server system. Its Symitar brands credit union platforms comprise Episys, an IBM Power System primarily designed for credit unions; and CruiseNet, a Windows-based client/server system designed primarily for credit unions. In addition, the company offers electronic payment services; purchases and resells hardware systems, including servers, workstations, scanners, and other devices; and provides implementation, training, and support services. (yahoo finance)
Here is last two years stock price progress and dividends.
JKHY stock price and dividend growth
The quarterly dividend has risen from 0.22 to 0.28 per share during the period. This is about 13.5% per year. The stock price has followed similarly.
Last quarter was also good beating forecasted EPS of $1.06 by $0.26. And for revenue of $366.97M (+10.0% Y/Y) beating by $11.57M.
Valuation and outlook
Jack Henry & Associates is a little bit on pricey side(+22PE) when company earnings growth is forecasted to slow down to 8% next year. 8% is still high if only financial technology group is inspected. There is no strong growth in horizon but steady tail winds should keep current stock price at 80 to 85 dollar level. And is unless something positive comes up next quarterly report.
I have a position in JKHY with share price paid of 72 dollars. I am not in hurry to sell as company has very low down side risk with strong position in financial technology sector. However I will be benchmarking this position against other opportunities and selling is not out of the question.