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Yahoo
01-08-2025
- Business
- Yahoo
Posthaste: Why the Canadian dollar has had a tough week
It's been a tough week for the Canadian dollar. First, United States Federal Reserve chair Jerome Powell on Wednesday showed no inclination to cut interest rates for the foreseeable future, while the Bank of Canada said the door is 'open' to paring back their policy rate. Then last night, U.S. President Donald Trump upped the pressure by hiking tariffs on Canadian goods to 35 per cent. The increased tariff rate came into effect today on all goods not covered by the Canada-U.S.-Mexico Agreement (CUSMA). Following Trump's announcement, the loonie fell nearly half a per cent, nearing 72 U.S. cents, but was regaining some of that lost ground in early trading. 'It (the Canadian dollar) is now recovering territory as traders take a more nuanced view on the longer term economic effects,' Karl Schamotta, chief market strategist at Corpay Inc., said in a note late Thursday, adding that 'currency markets are reacting with remarkable aplomb, suggesting that tonight's actions were largely priced in.' Aug. 1 was Trump's deadline for Canada and the U.S. to reach a trade deal, but the U.S. president signed the executive order Thursday night to slap Canada with the increased duties. Meanwhile, a potentially widening interest rate gap between the central banks rates in the U.S. and Canada has clipped the Canadian dollar's wings. The Fed on Wednesday held its interest rate in the 4.25 per cent to 4.5 per cent range, its fifth consecutive hold since it last trimmed rates in December 2024. 'We think Powell's press conference performance set a very high bar for cutting in September,' analysts at currency specialist MonFX said in a note, adding 'that had been the market base case ahead of (Wednesday's) event.' In the wake of the Fed's announcement and Powell's ensuing press conference, markets trimmed their bets for a rate cut in September to only 10 basis points — which means no cut — and to 35 basis points by year-end, meaning one cut is still in the cards for 2025. MonFX is among those currency houses that think the Fed is done cutting for the year if the unemployment rate holds and signs of inflation start to percolate. With expectations of rate cuts evaporating, 'the (U.S. dollar) response was swift, broad and brutal, sending the DXY (U.S. dollar index) to its highest level since late May,' Shaun Osborne, chief FX strategist, and Eric Theoret, FX strategist, at the Bank of Nova Scotia, said in a note. The Canadian dollar fell nearly half a U.S. cent on Wednesday after the two central bank announcements. On Thursday, the loonie was one of only two major G10 currencies to post declines against the U.S. dollar. The other was the Japanese yen. More broadly, the loonie is down 2.2 per cent from its 2025 closing high on June 16 of 73.7 U.S. cents. The decline has partly coincided with the rise of the U.S. dollar index, which is up 1.1 per cent since then. 'The Canadian dollar is suffering as policy rate expectations against the U.S. diverge, and as traders brace for more negativity from south of the border,' Schamotta said in an earlier note. Schamotta's 'short-term call' is for the Canadian dollar to fall to 71.9 U.S. cents. Osborne and Theoret said risks related to trade and what they mean for the Bank of Canada's policy rate pushed the Canadian dollar to hit lows not seen since late May, with the pair noting that the tone of central bank announcements from this week has delivered a blow to the (Canadian dollar's) fundamentals.' The Scotiabank team has pencilled in a future value for the loonie of 72.9 U.S. cents. 'Looking forward, we expect that nuances in (Bank of Canada)/Fed rate expectations will become increasingly impactful on the (U.S. dollar/Canadian dollar),' Jeremy Stretch, chief international strategist at Canadian Imperial Bank of Commerce, said in a note. 'We expect immediate currency performance to remain a function of interest rate spreads, albeit we expect an increased degree of sensitivity to changes in (Bank of Canada) expectations.' to get Posthaste delivered straight to your economy is on track to outperform expectations in the second quarter even though it contracted in May, Statistics Canada said on Thursday. On a monthly basis, gross domestic product fell by 0.1 per cent in May, the same as in April. But Statistics Canada said in its flash estimate for June that the economy grew by 0.1 per cent, driven by increases in retail and wholesale trade, which would put annualized growth for the quarter at 0.1 per cent. — Jordan Gowling, Financial Post Read the full story here. Today's Data: Canada's S&P Global Manufacturing PMI, the U.S. Labor Department releases jobs numbers for June. Earnings: Fortis Inc., Enbridge Inc., Magna International Inc., TransAlta Corp., AltaGas Ltd., Imperial Oil Ltd., Brookfield Renewable Partners, Keg Royalties Income Fund The battle for Muskoka: How a mysterious developer's proposed mega-resort is sparking an existential crisis in cottage country Why today's growth numbers for the Canadian economy might be 'meaningless' Federal Court judge slams 'perpetual tax trap' on TFSA overcontributions If you accidentally over-contribute to your tax-free savings account (TFSA), you will face the dreaded over-contribution penalty tax. But what if by the time you realize that you over-contributed, the fair market value of the investments inside your TFSA has plummeted to such an extent that it's below the value of the over-contribution you need to withdraw? Find out what happened to this taxpayer and why a federal court judge is frustrated with this 'perpetual tax trap.' Read here. Are you worried about having enough for retirement? Do you need to adjust your portfolio? Are you starting out or making a change and wondering how to build wealth? Are you trying to make ends meet? Drop us a line at wealth@ with your contact info and the gist of your problem and we'll find some experts to help you out while writing a Family Finance story about it (we'll keep your name out of it, of course). McLister on mortgages Want to learn more about mortgages? Mortgage strategist Robert McLister's Financial Post column can help navigate the complex sector, from the latest trends to financing opportunities you won't want to miss. Plus check his mortgage rate page for Canada's lowest national mortgage rates, updated daily. Financial Post on YouTube Visit the Financial Post's YouTube channel for interviews with Canada's leading experts in business, economics, housing, the energy sector and more. Today's Posthaste was written by Gigi Suhanic with additional reporting from Financial Post staff, The Canadian Press and Bloomberg. Have a story idea, pitch, embargoed report, or a suggestion for this newsletter? Email us at posthaste@ Posthaste: Why Canada's job market might be too good to be true Posthaste: Canadians are dragging their feet back to the office — with many opting to cheat or quit Sign in to access your portfolio
Globe and Mail
19-05-2025
- Business
- Globe and Mail
Corpay Stock Jumps 25% in a Year: Here's What You Should Know
Corpay, Inc. CPAY has had a remarkable run over the past year. The company's shares have gained 25% in that period compared with its industry and the Zacks S&P 500 composite's growth of 25.6% and 13.6%, respectively. Corpay, Inc. Price CPAY's revenues are expected to rise 11.3% year over year in 2025 and 10.6% in 2026. Its earnings are estimated to increase 10.4% in 2025 and 16% in 2026. CPAY Raised 2025 Top-Line Outlook For 2025, Corpayraised the revenue guidance to $4.38-$4.46 billion from the preceding quarter's view of $4.35-$4.45 billion. This is a continuous improvement from the third quarter of 2024, wherein the company expected the top line to be $3.98-$4.01 billion. Such a gradual increment boosted investors' confidence. Corpay's Organic Revenue Growth Looks Promising In 2022, 2023 and 2024, CPAY's organic revenues increased 13%, 10% and 20%, respectively. Despite a marginal slowdown in 2023, the company's organic revenues skyrocketed in 2024, fueled by increased volume and revenues per transaction in its payment programs. Such results indicate the company's effective strategy to maintain healthy demand for its services. This leads to an increase in confidence among existing and potential investors, making the stock more appealing. CPAY's Multi-Channel Approach Aids Customer-Base Expansion Corpay leverages a multi-channel approach to market and sell solutions to current and prospective clients. This go-to-market strategy involves a comprehensive digital channel, direct sales forces and strategic partner relationships. The company expands online continuously, with end-to-end capabilities, wherein customers can buy, onboard and manage their accounts on their own. CPAY's salespeople have become more efficient by improving their efforts via digitally sourced leads utilizing this omnichannel approach. Corpay's Consistent Buyout Strategy CPAY acquires companies both in the United States and on a global scale to expand its customer base, workforce and operational capabilities. It also expands an array of services across various industries. In December 2024, the company acquired GPS Capital Markets, which expanded its corporate payments business. In September 2023, Corpay acquired PayByPhone, a global digital parking payment solutions provider, which expanded its vehicle payment solutions for B2B fleet customers in North America and Europe. Notable acquisitions include Global Reach Group, Mina Digital Limited and Business Gateway AG, which marked a significant expansion of Corpay's product portfolio and geographic presence. CPAY's Zacks Rank & Stocks to Consider Corpay carries a Zacks Rank #3 (Hold) at present. Investors interested in the Zacks Business Services sector may look at some better-ranked stocks like Amadeus IT Group AMADY and AppLovin APP, each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today's Zacks #1 Rank stocks here. Amadeus IT Group has a long-term earnings growth expectation of 7.7%. AMADY delivered a trailing four-quarter earnings surprise of 7.4%, on average. AppLovin has a long-term earnings growth expectation of 20%. APP delivered a trailing four-quarter earnings surprise of 22.9%, on average. 7 Best Stocks for the Next 30 Days Just released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops." Since 1988, the full list has beaten the market more than 2X over with an average gain of +23.0% per year. So be sure to give these hand picked 7 your immediate attention. See them now >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. AppLovin Corporation (APP): Free Stock Analysis Report Corpay, Inc. (CPAY): Free Stock Analysis Report
Yahoo
07-05-2025
- Business
- Yahoo
Corpay Inc (CPAY) Q1 2025 Earnings Call Highlights: Strong Revenue Growth and Strategic ...
Revenue: Q1 2025 revenue of $1.6 billion, up 8% year-over-year. Cash EPS: $4.51, up 10% year-over-year; would be up 18% on constant macro basis. Organic Revenue Growth: 9% overall; Vehicle Payments 8%, Corporate Payments 19%. Same-Store Sales: Positive 1% growth. Retention Rate: Steady at 92%. Sales/New Bookings: Up 35% versus Q1 last year. Full Year 2025 Revenue Guidance: $4.420 billion at the midpoint. Full Year 2025 Cash EPS Guidance: $21 at the midpoint. Corporate Payments Revenue: Up 19% organically. Cross-Border Revenue: Increased 18% organically. Vehicle Payments Revenue: Grew 8% organically. Operating Expenses: $579 million, increased 8% year-over-year. Adjusted EBITDA Margin: 55.2%, consistent with prior year. Leverage Ratio: 2.69x, down 6 bps from year-end. Cash and Revolver Availability: Over $2.5 billion at the end of the quarter. Q2 2025 Revenue Growth Expectation: 12% to 14%. Q2 2025 Cash EPS Growth Expectation: 11% to 13%. Release Date: May 06, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Positive Points Corpay Inc (NYSE:CPAY) reported Q1 2025 revenue of $1.6 billion, an 8% increase, with cash EPS up 10% to $4.51. Organic revenue growth was strong at 9%, with Vehicle Payments and Corporate Payments segments showing 8% and 19% growth, respectively. The company announced a strategic partnership with Mastercard, which is expected to add 2% to 3% incremental revenue growth to the cross-border business starting next year. Corpay Inc (NYSE:CPAY) is maintaining its full-year 2025 guidance with expected organic revenue growth of 11% and cash EPS of $21. The company is actively pursuing M&A opportunities, including a $500 million investment in Avid, which is expected to be accretive to earnings in 2026. Negative Points The company faced a $6 million unfavorable fuel spread revenue shortfall in Q1 due to low price volatility. Cross-border revenue was impacted by U.S. tariff policies, with an expected unfavorable impact of $10 million to $15 million for the remainder of 2025. U.S. Vehicle Payments revenue declined by 3% organically, although improvements in retention and sales are anticipated. Lodging organic revenue growth was down 1% for the quarter, although it showed improvement from the previous year's decline. The macroeconomic environment remains uncertain, with potential indirect impacts from tariffs on client volumes and overall business performance. Q & A Highlights Q: Can you provide more details on the partnership with Mastercard and the expected revenue growth? A: Ronald Clarke, CEO, explained that the partnership with Mastercard is expected to add 2-3% incremental revenue growth to Corpay's cross-border business. He emphasized the significant opportunity due to the large volume of cross-border payments currently handled by banks, and expressed confidence that Mastercard's involvement will drive growth.
