NEW YORK (TheStreet) -- Shares of Vantiv (VNTV) are down 5.75% to $55.22 on heavy trading volume Friday afternoon after the company posted solid results for the 2016 second quarter, but was downgraded due to outlook concerns.
After yesterday's closing bell, the Cincinnati-based payment processing provider reported earnings of 70 cents per share, above analysts' estimates of 68 cents per share. Revenue was $480 million, higher than analysts' projections of $465.67 million.
Vantiv's stock rating was reduced to "outperform" from "buy" at CLSA following the results, the Fly reports.
The company beat second quarter expectations due to solid merchant and financial institutions unit results, CLSA noted. But the back-half of the year will moderate due to factors impacting its financial institutions segment, which will make multiple expansion difficult, the firm noted.
The stock was also downgraded to "equal weight" from "overweight" with a $60 price target at Barclays following the quarterly report.
"While we're constructive on VNTV's merchant business, we also now see greater pressure than previously expected on FI growth from the renewal of Fifth Third (FITB) combined with higher expense growth for sales/marketing leading to margin degradation during 2H16 and into 2017," the firm wrote in an analyst note.
Vantiv and Fifth Third agreed to renew their commercial relationship and extend it through the end of 2024, the Fly said.
About 4.14 million of the company's shares were traded so far today vs. its average volume of 1.61 million shares per day.
Separately, TheStreet Ratings Team has a "Buy" rating with a score of B on the stock.
The company's strengths can be seen in multiple areas, such as its robust revenue growth, impressive record of earnings per share growth, compelling growth in net income, notable return on equity and solid stock price performance.
The team believes its strengths outweigh the fact that the company has had generally high debt management risk by most measures that were evaluated.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: VNTV