CPAY — Corpay, Inc.

The mood turned positive after Q2 2026 beat-and-raise: revenue grew 21.5% YoY to $1.34B, record cash EPS rose 36% to $7.00, and management lifted FY2026 guidance to $5.29–$5.33B revenue and $27.15–$27.55 adjusted EPS. Wall Street responded with price-target hikes, including Wolfe Research to $530, and the consensus is Buy with no Sell ratings. The $100M FTC charge in Q2 was absorbed without derailing the story.

Revenue growth has clearly accelerated: YoY growth went from ~6% in Q3 2024 to ~10% in Q4 2024, then stepped up from 12.9% in Q2 2025 to 21.5% in Q2 2026. TTM revenue reached $5.02B. Adjusted operating performance remains strong, but Q2 2026 GAAP operating margin fell to 35.2% because of the $100M FTC settlement charge; add that back and the margin was roughly 42.7%, consistent with the prior low-40s pattern. GAAP net income dipped to $248M vs. $284M a year ago solely on that one-off, while management's adjusted cash EPS hit a record $7.00. This is a GAAP blip, not a structural deterioration.

On trailing GAAP earnings the stock looks full: P/E TTM is 24.2, PEG is 2.19, and P/B is 7.47. But the trailing P/E is distorted by the FTC charge; on FY2026 consensus adjusted EPS of $27.35, the forward P/E is only about 14.8x, well below the 5-year average P/E of 20.2x. Current P/S of 5.26 is also in line with the 5-year average of 5.33. Overall, valuation is fair to modestly attractive for a business growing revenue above 20% with roughly 40% operating margins.

Price sits at $403.67, close to the 52-week high of $425.95, but earnings estimates have been moving up faster than price. At ~15x forward adjusted EPS, the market is not paying much for the current acceleration or the guidance momentum. If FY2026 estimates hold and the multiple simply reverts toward its own history, the stock has meaningful upside; the offsetting risk is that adjusted EPS relies on add-backs and the high debt load makes the multiple vulnerable if rates rise.

As of 2026-08-27, RSI-14 was 54.54, meaning neutral rather than overbought or oversold. Price was -0.29% vs. its 20-day SMA, +7.32% vs. its 50-day SMA, and +21.2% vs. its 200-day SMA. That is an intact intermediate/long-term uptrend with a short-term consolidation after a big rally off the 252.84 low. Chasing here is less attractive than waiting for a pullback toward the 20-day or 50-day area, but the trend is not broken.

• Persistent interest rates support Corpay's float income on client funds, though core growth is increasingly driven by transaction volume rather than rate tailwinds.
• B2B payments digitization, cross-border expansion, and AP automation are secular tailwinds; the estimated $560B TAM remains barely penetrated.
• Fintech/regulatory attention is a live factor: the $100M FTC settlement clears some overhang, but compliance costs and future regulatory actions remain risks.
• The divestiture of UK vehicle software assets to OEConnection/Francisco Partners and expected buyback deployment could improve the portfolio mix and reduce share count.
• A macro slowdown or sharp FX volatility could pressure transaction volumes and cross-border flows, even though current organic growth has been resilient.

• Q3 FY2026 earnings expected in early November 2026: investors want continued double-digit organic growth and progress toward full-year margin targets.
• Closing the epyx/r2c Online/Business Gateway divestiture in Fall 2026 and redeploying proceeds through share repurchases.
• Completion of the unified corporate payments platform migration in Q4 2026 and early commercial traction for the new Agent Card AI-agent commerce product.
• Further regulatory/legal clarity following the preliminary FTC settlement.

• High leverage: long-term debt is $6.10B, debt/equity is ~3.0x, and the current ratio is 0.97; refinancing risk or higher rates could pressure earnings and the multiple.
• Regulatory/fintech compliance risk beyond the FTC matter; additional fines or restrictions could hit corporate and vehicle payment segments.
• Integration/execution risk from the platform migration, Alpha Group integration, and the pending divestiture.
• Competition from financial institutions and fintechs in corporate payments could pressure pricing and revenue growth.
• A deeper macro recession or sustained FX volatility could reduce transaction volumes and cross-border payment activity.

Corpay is a high-quality B2B payments compounder with accelerating revenue growth, low-40s adjusted operating margins, and a forward P/E near 15x. The bull case is supported by secular digital-payments tailwinds and a beat-and-raise operating trajectory; the main offsets are high leverage and regulatory overhang. As of 2026-08-27, I view it as a good long-term investment, with fair value around $479—above the current price but below the most aggressive analyst targets.

Calculated by applying a justified forward P/E of 17.5x to FY2026 consensus adjusted EPS of $27.35. The 17.5x multiple is roughly a 13% discount to Corpay's 5-year average P/E of 20.2x to reflect higher leverage, the FTC overhang, and divestiture/execution risk; this implies a forward P/S of about 5.9x, a reasonable premium to the 5-year average given the margin profile and growth acceleration.