GPN, Global Payments Inc.
Read top to bottom, the owner's questions in the order an owner asks them: what the business is, whether the record holds, whether it survives and is any good, and what you would be paying. New to the questions? Start with the Method.
The business in brief
read the 10-K →What this business is and what moves its needle, read from the numbers in its filings. The quantitative detail is in the sections below; the verdict is left to you.
- What it is
- A capital-intensive business, run on heavy physical assets that have to be kept working.
- What moves the needle
- How hard the assets work, and what the inputs cost. What decides it: utilization, how much of the capex merely keeps the assets running, and what a downturn does to a heavy fixed-cost base.
- Is it a good business?
- Return on capital has rarely cleared the cost of capital (median 3%, above 15% in 0 of 10 years). Owner earnings agree: roughly 25% of revenue reaches owners as cash, consistently, and customers and suppliers fund the business through negative working capital. This is price-taker territory, where the balance sheet and the cycle matter more than any multiple; the 10-K is where you look.
Every line here is arithmetic from the company's own filings, not a model's opinion, and each figure appears in full in the sections below.
The record, 2016–2025
realized figures from each filing, no estimates| 2016’16 | 2017’17 | 2018’18 | 2019’19 | 2020’20 | 2021’21 | 2022’22 | 2023’23 | 2024’24 | 2025’25 | TTMTTMMar 2026 | |
|---|---|---|---|---|---|---|---|---|---|---|---|
| RevenueRevenue | $2.9B | $4.0B | $3.4B | $4.9B | $7.4B | $8.5B | $9.0B | $7.4B | $7.7B | $7.7B | $8.9B |
| Operating marginOp. mgn | 14.7% | 14.1% | 21.9% | 16.1% | 12.0% | 15.9% | 7.1% | 17.8% | 25.5% | 22.8% | 15.4% |
| Net incomeNet inc. | $272M | $468M | $452M | $431M | $585M | $965M | $111M | $986M | $1.6B | $1.4B | ($706M) |
| EPS (diluted)EPS | $1.35 | $2.00 | $1.88 | $1.43 | $1.95 | $3.29 | $0.40 | $3.77 | $6.16 | $5.79 | $-2.58 |
| Owner earningsOwner earn. | $501M | $330M | $893M | $1.1B | $1.9B | $2.3B | $1.6B | $1.9B | $2.4B | $2.0B | $1.1B |
| ROICROIC | 6% | 8% | 8% | 2% | 2% | 3% | 1% | 3% | 5% | 4% | 3% |
| CapexCapex | $92M | $182M | $213M | $308M | $436M | $493M | $616M | $658M | $675M | $618M | $752M |
| Capex / revenueCapex/rev | 3.2% | 4.6% | 6.3% | 6.3% | 5.9% | 5.8% | 6.9% | 8.9% | 8.7% | 8.0% | 8.5% |
| Capex vs depreciationCapex/dep | 0.49× | 0.40× | 0.41× | 0.35× | 0.27× | 0.29× | 0.37× | 0.58× | 0.55× | 0.50× | 0.42× |
| Total debtDebt | $4.5B | $4.7B | $5.2B | $9.1B | $9.3B | $11.5B | $13.5B | $16.4B | $16.3B | $21.6B | $23.5B |
| Cash & investmentsCash+inv | $1.0B | $1.3B | $1.2B | $1.7B | $1.9B | $2.0B | $2.0B | $2.1B | $2.4B | $8.3B | $5.9B |
| Net debt / (cash)Net debt | $3.4B | $3.4B | $4.0B | $7.4B | $7.3B | $9.5B | $11.5B | $14.3B | $14.0B | $13.2B | $17.7B |
Owner’s Scorecard
Will it survive?
- Can it pay its interest? 104.1×ComfortableOperating income $1.8B ÷ interest expense $17M
Operating profit covers interest with the kind of margin Graham wanted for a defensive holding. Necessary, not sufficient, it says solvent, not cheap.
- How heavy is the debt? 12.3×HighTotal debt $21.6B ÷ operating income $1.8B
Years of operating profit it would take to repay all debt. A first read, not a credit rating: it's gross debt (not netted against cash) over EBIT (not EBITDA), and a cyclical year distorts it.
- Debt, net of cash $13.2BHeavy net debtCash $8.3B − debt $21.6B
Netting $8.3B of cash and short-term investments against $21.6B of debt leaves $13.2B owed, about 7.6× a year's operating profit, versus the gross figure above. Net debt is the leverage figure that matters; the gross ratio above ignores the cash already set against it. Strategic or illiquid investments aren't counted here.
- Negative, funded by othersDSO 37 + DIO 1 − DPO 48 days
Days cash is tied up between paying suppliers and collecting from customers. A negative cycle is a quiet moat: suppliers and customers fund the operation (Buffett's “float”), the company grows on other people's money.
Is it a good business?
- Below averageNOPAT $1.5B ÷ invested capital $36.1B (debt + equity − cash)
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; below ~8% the company may destroy value as it grows. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
- Cash machineOwner Earnings $2.0B = operating cash $2.7B − capex $618M
What an owner could take out without starving the business. That's 26% of revenue. Treating stock comp as the real expense it is (less $154M of SBC) leaves $1.9B. Honest caveat: capex here blends maintenance and growth, so steady-state Owner Earnings may run higher (see capex vs. depreciation).
- Cash-backedCash from ops $2.7B ÷ net income $1.4B
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.
How is the cash used?
- Returns about halfDividends + buybacks $1.4B ÷ Owner Earnings $2.0B
Of $2.0B Owner Earnings, $1.4B (70%) went back to shareholders, $239M dividends, $1.2B buybacks. Net of $154M stock comp, the real buyback was about $1.0B. Returning most of it signals a mature cash machine; reinvesting most could mean a long runway, or empire-building. The split doesn't say which; the return earned on it (see ROIC) does.
- Investing or harvesting? 0.50×HarvestingCapex $618M ÷ depreciation $1.2B
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.
Durability & moat, 2016–2025
A moat is a high return that doesn’t fade, reinvested at high returns. Here is what the record says, judgments, not another chart of the numbers.
- Profitable years 10 of 10
Never lost money over the record, the earnings stability Graham insisted on.
- Return on capital ≥ 15% 0 of 10 yrs
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
- Operating margin 15% (FY2016) → 23% (FY2025)
Margins widened over the record, pricing power intact or improving.
- Reinvestment, incremental ROIC 3%
Reinvested capital earned only a modest return, growth is getting expensive.
- Owner earnings growth +20%/yr
Free cash to owners grew about 20% a year over the record.
- Worst year 2022 · 7.1% op. margin
Stayed profitable even in its hardest year, the resilience that survives recessions.
- Dividend record rising
Paid and raised the dividend across the record, the continuity Graham prized.
Solvent is not the same as cheap; growing is not the same as good. These are vital signs, not a verdict, the judgment is yours, and the filing is one click away.
How the cash was used, 2016–2025
Over the record, the business generated $19.2B of operating cash, and how management split it is, as Buffett insists, the job that matters most. Here it reads as a hoarder, a large share of cash simply built the balance sheet.
- Reinvested$4.3B · 22%
- Dividends$1.6B · 8%
- Buybacks$9.8B · 51%
- Retained (debt / cash)$3.5B · 18%
It reinvested $4.3B (22%) back into the business and returned $11.4B (59%) to owners, $1.6B in dividends, $9.8B in buybacks. Total debt rose $19.0B across the span.
Buybacks are gross of stock issued to employees; net of that, the real return to owners is lower (see Management & pay). And the mix alone doesn't grade management, what matters is the return earned on the dollars reinvested (see incremental ROIC in the durability report).
Management & pay
Two questions Buffett actually asks about pay: is stock compensation, a real expense, whatever the income statement pretends, quietly large, and is the top wildly out of line with the floor. He's no populist about it; he just wants pay that's rational and earned, and comp committees that aren't lapdogs.
- Stock-based compensation$154M
The slice of the business handed to employees in shares this year, 2% of revenue, equal to 9% of operating profit. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. And note the trap, the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.
Graham’s defensive-investor test
4 of 6 metGraham gave the defensive investor seven numerical criteria in The Intelligent Investor. Here they are, run mechanically on the filings, his framework, not our verdict. Meeting them is a floor of safety, not a reason to buy; missing one is no veto, since many fine modern businesses fail his strictest liquidity tests by design. The worth is in seeing exactly where a company stands against the canon, every number sourced.
- Adequate size PassRevenue ≥ $2B · $7.7B
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
- Strong liquidity NearCurrent ratio ≥ 2× · 1.69×
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
- Conservative debt MissDebt ≤ working capital · $21.6B vs $5.1B WC
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
- Earnings stability PassA profit every year (10-yr record) · no losses
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
- Dividend record PassUninterrupted dividends · paid every year (10)
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
- Earnings growth PassEarnings +33% over the record · +232%
At least a third more earnings than a decade ago, averaging three years at each end. Net income (not per-share), so stock splits don't distort it, buybacks and dilution show up in the share-count line instead.
- Moderate price —P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Earnings are $5.79/share and book value $94.58/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.
Graham would be the first to say a checklist is a starting point, not an answer. These are his defensive, bargain-hunter's tests, the cigar-butt lens. Buffett and Munger grew past it, paying fair prices for wonderful businesses; that lens lives in the moat and owner-earnings work above, and both still matter. Clearing Graham’s tests earns a closer look; failing them earns harder questions, not a dismissal.
What the price implies
reverse-DCFA price is the one input we don't pull, you bring it. Type today's close (read it off any broker or quote site) and see the owner-earnings growth you'd have to believe to justify it, set beside what Global Payments Inc. has actually delivered. Nothing is stored; the number stays in your browser.
Enter a price above to run it.
Graham capped the multiple at 15×; Buffett and Munger let that rule go, a wonderful business can deserve 50× if the thesis holds. Read it as the bargain-hunter's floor, not a ceiling on good sense.
The discount rate is your interest rate, what a dollar years from now is worth today, anchored to the long-term Treasury yield (~4–5% today, plus whatever premium you want for risk). Drag it toward the risk-free rate and watch how much growth the price suddenly “needs”: interest rates are gravity on valuations.
Owner earnings $1.1B on 273M diluted shares; net debt $17.7B. This is a lens, not a price target, it says what you'd have to believe, not what the company is worth, and it runs on one year of (noisy) owner earnings at assumptions you can see and change.
What the filing emphasizes, FY2025
read the 10-K →Each year a 10-K must name what could go wrong, in the company's own words. Here are the ones Graham and Buffett would stop on, each set against the figure from the same filings that bears on it, anchored to a period you can find in the record above. We point; the judgment is yours.
- Debt terms & refinancingRisk Factors
The fine print behind the debt. Covenants and near-term maturities decide who is really in control when a year goes badly.
“The amounts available to borrow under the Revolving Credit Facility are also determined by a financial leverage covenant.”
From the recordBalance sheet (TTM)$13.2B heavy net debt · interest covered 104.1× - Litigation & contingenciesRisk Factors
Claims an owner inherits. Most disclosure is boilerplate; this fires only on an actual matter, a named suit, a settlement, a contingency, a number.
“We issued the senior notes at a total discount of $3.3 million and capitalized related debt issuance costs of $8.4 million.”
A judgment, not a number, weigh it against the filing yourself. - Regulation & policyRisk Factors
Rules that can rewrite the economics, tariffs, antitrust, data, export controls.
“On August 16, 2022, the U.S. government enacted the Inflation Reduction Act into law, which, among other things, implemented a 15% corporate alternative minimum tax based on global adjusted financial statement income and a 1% excise tax on share repurchases effective beginning January 1, 2023.”
A judgment, not a number, weigh it against the filing yourself.
What changed, FY2025 vs FY2024
read the 10-K →Most of a 10-K is boilerplate carried over verbatim; the signal is in what's new. These lines appear this year and weren't there last, figure updates filtered out, so only the language shift remains.
- “The amount of cash that we consider to be available for general purposes (inclusive of discontinued operations), $ 980.7 million and $ 1,067.5 million as of December 31, 2025 and 2024, respectively, does not include the following: (i) settlement-related cash balances, (ii) funds held as collateral f…”
- “Performance obligations in a contract are identified based on the goods or services that will be transferred to the customer that are both capable of being distinct, whereby the customer can benefit from the service either on its own or together with other resources that are readily available from t…”
- “Investments in foreign operations with functional currencies other than the reporting currency are subject to foreign currency risk as the assets and liabilities of these subsidiaries are translated into the reporting currency at the period-end rate of exchange with the resulting foreign currency tr…”
- “Currently unforeseen circumstances in software development, such as a significant change in the manner in which the software is intended to be used, obsolescence or a significant reduction in revenues due to customer attrition, could require us to implement alternative plans with respect to a partic…”
Classic text analysis over the filing itself, no model wrote a word of this, and every quote is the company's own.
Peers, Business services
The same industry, side by side on owner economics, compare, don't rank by a single number.● marks best in the group.
| Company | Revenue | Gross margin | Op. margin | ROIC | Owner earn. margin |
|---|---|---|---|---|---|
| UBERUber Technologies, Inc. | $52.0B | — | 10.7% | 18% | 19% |
| VVisa Inc. | $40.0B | — | 60.0% | 43% | 54% |
| PYPLPaypal Holdings, Inc. | $33.2B | — | 18.3% | 23% | 17% |
| MAMastercard Inc | $32.8B | — | 57.6% | 94% | 52% |
| DASHDoordash, Inc. | $13.7B | — | 5.3% | 13% | 16% |
| EBAYEbay Inc. | $11.1B | 71% | 20.5% | 19% | 13% |
| GPNGlobal Payments Inc. | $7.7B | 73% | 22.8% | 4% | 26% |
| MSCIMsci Inc. | $3.1B | 91% | 54.7% | 45% | 49% |