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Currency Exchange International reported a strong quarter, with net income climbing to $5.2 million. While total revenue grew a modest 5 percent to $22.4 million, the company is becoming much more efficient at turning those sales into profit. This jump in earnings per share shows the business is successfully shifting toward its digital payments arm, which carries higher margins than its traditional business of shipping physical cash to banks and travelers.
This shift is the core of our view on the stock. By using its existing network of 1,600 financial institutions to sell digital payment software, the company is growing its most profitable segment without needing to build expensive new infrastructure. The results suggest this transition is gaining speed, making the company more profitable even when total revenue growth looks steady rather than explosive.
Management has now delivered two straight quarters of significant profit beats. The business is currently outrunning analyst forecasts as the shift toward high-margin digital payments gains speed.
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