Deluxe (NYSE:DLX) Issues Earnings Results

Deluxe (NYSE:DLX) released its quarterly earnings results on Wednesday. The business services provider reported $0.87 earnings per share for the quarter, topping the consensus estimate of $0.81 by $0.06, FiscalAI reports. The business had revenue of $499.30 million for the quarter, compared to the consensus estimate of $486.30 million. Deluxe had a net margin of 5.01% and a return on equity of 24.11%. The company’s quarterly revenue was down 4.2% on a year-over-year basis. During the same period last year, the firm earned $0.88 earnings per share.

Here are the key takeaways from Deluxe’s conference call:

• Q2 execution remained strong, with comparable adjusted revenue up 2.6%, adjusted EBITDA up 5.3%, adjusted EPS increasing to $0.87, and adjusted EBITDA margin expanding to 21.8%. Year-to-date free cash flow rose nearly 65% to $85.9 million, supporting $75.2 million of net debt reduction.
• Deluxe closed its Celero acquisition, expanding the merchant-services platform to more than 210,000 merchants and over $70 billion in annual payment volume. Management expects cost synergies and longer-term revenue opportunities, while raising full-year 2026 revenue guidance to $2.095 billion-$2.12 billion and adjusted EBITDA guidance to $455 million-$475 million.
• The payments and data businesses continued to drive the transformation, growing 11% year to date and reaching 52% of revenue. Data Solutions revenue increased 21.4% in Q2, marking more than 15% growth for seven consecutive quarters, while merchant-services revenue grew 6.1%.
• Print remains a declining business, with comparable adjusted revenue down 4.3% in Q2; legacy check revenue fell 1.7% and other print revenue declined 10.1%. Management expects low- to mid-single-digit print revenue declines for the full year, while warning that difficult comparisons could moderate Data Solutions growth in the second half.
• Despite higher revenue and EBITDA guidance from Celero, Deluxe left adjusted EPS guidance at $3.60-$4.00 and free cash flow guidance at approximately $200 million because incremental interest expense, integration costs, and tax effects are expected to offset much of the acquisition’s near-term contribution. The company expects Celero to be EPS-accretive in the first full year after closing and plans to return to approximately 3.0 times net leverage within two years.

Deluxe Price Performance

Shares of DLX traded down $0.42 during mid-day trading on Wednesday, reaching $26.56. The stock had a trading volume of 357,550 shares, compared to its average volume of 349,312. The firm has a market cap of $1.22 billion, a price-to-earnings ratio of 11.35, a PEG ratio of 0.68 and a beta of 1.24. Deluxe has a 12 month low of $15.87 and a 12 month high of $32.07. The business has a fifty day moving average of $24.51 and a 200 day moving average of $26.10. The company has a debt-to-equity ratio of 1.98, a quick ratio of 1.05 and a current ratio of 1.15.

Institutional Inflows and Outflows

A number of large investors have recently modified their holdings of DLX. Focus Partners Wealth purchased a new stake in Deluxe in the 3rd quarter worth $373,000. State of Wyoming raised its holdings in Deluxe by 37.2% during the second quarter. State of Wyoming now owns 22,761 shares of the business services provider’s stock valued at $362,000 after acquiring an additional 6,173 shares during the period. State Board of Administration of Florida Retirement System lifted its position in shares of Deluxe by 22.0% in the fourth quarter. State Board of Administration of Florida Retirement System now owns 15,168 shares of the business services provider’s stock valued at $339,000 after acquiring an additional 2,739 shares in the last quarter. Brooklyn Investment Group purchased a new position in shares of Deluxe in the fourth quarter valued at about $270,000. Finally, Verition Fund Management LLC boosted its stake in shares of Deluxe by 19.4% in the third quarter. Verition Fund Management LLC now owns 13,384 shares of the business services provider’s stock worth $259,000 after acquiring an additional 2,170 shares during the period. Hedge funds and other institutional investors own 93.90% of the company’s stock.

Wall Street Analysts Forecast Growth

DLX has been the subject of several analyst reports. Zacks Research lowered Deluxe from a “strong-buy” rating to a “hold” rating in a research note on Friday, April 10th. Wall Street Zen upgraded Deluxe from a “buy” rating to a “strong-buy” rating in a research report on Saturday, June 6th. Finally, Weiss Ratings lowered Deluxe from a “buy (b-)” rating to a “hold (c+)” rating in a report on Wednesday, July 15th. One equities research analyst has rated the stock with a Buy rating and three have assigned a Hold rating to the stock. Based on data from MarketBeat, Deluxe presently has an average rating of “Hold”.

About Deluxe

Deluxe Corporation, founded in 1915 and headquartered in Shoreview, Minnesota, is a provider of integrated business and financial technology solutions. Originally established as a check printing company, Deluxe has evolved its offerings to support small businesses, financial institutions and entrepreneurs with a comprehensive suite of services spanning print, digital and software platforms.

The company’s core business activities include printing checks, forms and promotional materials, as well as delivering digital marketing and customer engagement solutions.