EVERTEC, Inc. (EVTC) - Due Diligence

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73OpportunityDD: Aug 16, 2026Analyst: 72

paidPrice at analysis date

USD 32.0 (16/08/2026)

domainMkt cap

$1.91B

pie_chartShares

59.75M

candlestick_chart52W

$21.81-$37.71

trending_downShort interest

3.5%

INFONYSEFinancials5327 employeesFounded 1998

Verdict: LOW-MEDIUM RISK — UNDERVALUED QUALITY COMPOUNDER

Asset-light payments platform with ~40% Adj EBITDA margin, ~26% ROE, and now +20% organic revenue growth on LatAm expansion (Dimensa Brazil, Transbank Chile, BBChain, Tecnobank). FY26 guidance raised, $150M buyback authorization refreshed. Trades ~8x fwd P/E and ~6.7x EV/EBITDA vs peers 13-15x / 10-12x — discount reflects Puerto Rico concentration + May-2026 cyber incident, but is excessive given fundamentals. Base FV ~$48 vs $31.98 = +51%.

📊 DIANALITICS RESEARCH INDEXCompany & Thesis Assessment Score /100 - updated 2026-08-16

EVERTEC, Inc. (EVTC)

Financial Technology · NYSE · San Juan, PR

"Quality compounder mispriced by geographic concentration overhang."

ROE ~26% EBITDA margin ~40% Fwd P/E ~8x Net leverage 2.55x Cyber May-26

Fin. strength

/20 pts

EBITDA/FCF

/15 pts

Debt/leverage

/15 pts

Stage/business

/15 pts

Catalysts

/10 pts

Reg. risk

/8 pts

Risk/reward

/7 pts

Management

/5 pts

Sector/macro

/3 pts

Compliance

/2 pts

Fair Value Estimate — EV/EBITDA (peer-derived)

Fair value base case

USD 48.0

Range: USD 34.0-USD 63.0

Price at analysis date: USD 32.0 (16/08/2026)

Base upside/downside: +51%

Peer-median EV/EBITDA forward, -15% haircut for concentration/cyber risk. FY26 Adj EBITDA ($431M) is an ESTIMATE from guided revenue mid x guided EBITDA margin mid — not an official single-line company figure. Cross-check via P/E gives $47.88, within 1% of base FV. Sensitivity: +/-1x on multiple = +/-$7/sh. Scenario weighting reflects QUALITY factor bias (balanced). ⚠ Not investment advice.

Component	Assumption	USD/share
CORE BUSINESS VALUE (EV)	Adj EBITDA FY26E $431M x 9.0x = EV $3,879M / 59.75M sh	+64.92
NET DEBT	Net debt $1,000M / 59.75M sh (Q2 2026)	-16.74
BUYBACK ACCRETION	$150M authorization x ~50% deployed at ~$32 = ~2.3M sh retired, valuation uplift	+0.01
FV base case	Sum of rows above	= $48.19

Bull

$63

Probability: 25%

LatAm platform scales; multiple re-rates to peer median 11x EV/EBITDA. Buyback fully deployed. FV +96%.

Base

$48

Probability: 50%

Execution as guided (rev +16-17%, margin ~40%). Multiple partially closes to 9x EV/EBITDA. FV +51%.

Bear

$34

Probability: 25%

Cyber liability materializes; PR macro deterioration; LatAm FX headwinds. 7x EV/EBITDA. FV +6%.

Methodology: Peer-median EV/EBITDA forward, -15% haircut for concentration/cyber risk. FY26 Adj EBITDA ($431M) is an ESTIMATE from guided revenue mid x guided EBITDA margin mid — not an official single-line company figure. Cross-check via P/E gives $47.88, within 1% of base FV. Sensitivity: +/-1x on multiple = +/-$7/sh. Scenario weighting reflects QUALITY factor bias (balanced). ⚠ Not investment advice. Not investment advice.

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Recent catalyst — Q2 2026 beat + guidance raised (Aug 4, 2026)

Q2 revenue $274.8M (+20% YoY, cons. $262M), Adj EBITDA $109.3M (39.8% margin, +18% YoY), Adj EPS $1.05 vs cons. $0.95 (+11% beat). FY26 revenue guide lifted to $1.085-1.095B (+16-17% YoY), Adj EPS $3.94-4.04 (cons. $3.92). Board raised buyback authorization to $150M. Morgan Stanley PT raised to $34 from $25 (Aug 7). Momentum accelerating on Transbank Chile deal + Dimensa/BBChain Brazil integrations.

Net leverage of 2.55x is slightly above the 2.0x indicative threshold but within the company's own 2-3x target range for an asset-light payments processor with recurring cash flows — judgement call, flagged in the risk grid.

📊 Capital Structure · Short Interest · Buyback & Dilution

🟢 Short Interest

~3.5%

~2.1M sh shorted vs 59.75M outstanding. Low, no squeeze setup, but no bearish crowd either.

🟢 Share dilution (1Y)

-2.1%

From ~61.0M to 59.75M sh. Buyback offsetting SBC. Priority: capital return.

🟢 Buyback

$150M

Authorization raised Jul 31, 2026 (from $100M). Expires Dec 2027. ~7.8% of market cap.

Short Interest — context

EVTC — 3.5%

3.5%

Low short interest (3-4%) reflects the absence of a clear bear thesis: EVTC is not a controversial name, just an under-covered LatAm-focused compounder. Capital structure signals management confidence: dividend + refreshed buyback + shrinking share count.

$Financial analysis — FY 2023-2026E

Revenue FY26E

$1.09B

+16.7% YoY (guidance mid)

Adj EBITDA margin

39.5%

Stable vs 40.3% FY25

Adj EPS FY26E

$3.99

+13% YoY (guidance mid)

Net debt / EBITDA

2.55x

Within 2-3x company target

Item	FY23	FY24	FY25	FY26 Guidance
Revenue ($M)	695	845	932	1,085-1,095
Adj EBITDA ($M, est)	295	335	375	~431 (est)
Adj EBITDA margin	42.4%	39.6%	40.3%	39-40%
Net income ($M)	91	112	142	~235 (est)
Diluted EPS ($)	1.40	1.73	2.37	3.94-4.04 (adj)
Net debt ($M)	620	780	950	~1,000

FY23-FY25 figures from public disclosures (Business Wire, StockAnalysis). FY26E figures are estimates from company guidance mid-points; Adj EBITDA and net income figures are derived, NOT single-line guidance items.

Quarterly dynamics - last 5 quarters
Metric	Q2 2025	Q3 2025	Q4 2025	Q1 2026	Q2 2026
Revenue ($M)	228.6	235.5	239.3	247.9	274.8
YoY growth %	+9%	+11%	+13%	+8%	+20%
Adj EBITDA ($M)	92.6	96.5	97.5	97.4	109.3
Adj EBITDA margin	40.5%	41.0%	40.7%	39.3%	39.8%
Adj EPS ($)	0.89	0.92	0.94	0.90	1.05

Financial position and sustainability

Liquidity vs debt ($420M / $1.0B)

42%

Net leverage vs target (2-3x)

2.55x

ROE (LTM)

25.9%

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Business model — LatAm-focused payments and financial technology platform

Dominant merchant acquirer + processor in Puerto Rico, expanding across Latin America

EVTC is the leading transaction processor in Puerto Rico (near-monopoly on the ATH network) with a growing footprint across Latin America: Brazil via Dimensa (closed April 2026) and Tecnobank (Oct 2025), Chile via a strategic agreement with Transbank (May 2026), plus wins in Mexico and Colombia. Four segments: Payment Services PR/Caribbean (~30% rev), LatAm Payments & Solutions (~30%), Merchant Acquiring (~25%), Business Solutions (~15%). Model is asset-light and high-margin, mostly recurring (transaction fees, processing fees, SaaS-like business solutions). Revenue growth accelerating from single-digit organic to +16-20% with LatAm consolidation.

LatAm Payments & Solutions ~$320M FY26E (~30% rev) ramping Fastest-growing segment (+25% YoY): payment processing, ATH Movil-like solutions across Brazil, Chile, Mexico, Colombia. Key customer wins: Transbank (Chile), major banks in Brazil. Payment Services PR & Caribbean ~$330M FY26E (~30% rev) stable core Dominant ATH network in Puerto Rico. Low single-digit growth. Cash cow funding LatAm expansion. Concentration risk if PR macro deteriorates. Merchant Acquiring + Bus. Solutions ~$440M FY26E (~40% rev) healthy Mid-single-digit growth from acquiring; Business Solutions provides bank processing, hosting, BPO (Popular Inc. contract-based, sticky).

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Legal, regulatory and risk analysis

Geographic concentration — Puerto Rico

Moderate

~30-40% of revenue from PR/Caribbean. PR macro (fiscal fragility, demographics, hurricane risk) is a permanent overhang. Mitigated by LatAm diversification (from ~40% to ~60% LatAm over 3 years).

Cyber incident (May 13, 2026)

High

Unauthorized access to customer data disclosed. Federal law enforcement notified. Financial impact not yet quantified — potential regulatory fines, customer churn, remediation costs. Weight on the multiple until closure.

Net leverage 2.55x

Moderate

$1.0B net debt post Dimensa/Tecnobank. Within 2-3x company target but above 2x asset-light peer norm. FCF (~$300M/yr) supports deleveraging path.

LatAm FX exposure

Moderate

BRL, CLP, MXN, COP translation risk. Q2 2026 had FX tailwind; can reverse. Constant-currency growth disclosed separately for transparency.

Popular Inc. counterparty concentration

Moderate

Popular Inc. remains a large customer in PR via Business Solutions contracts. Long-term contracts renewed but concentration is real. Historically ~10-15% of revenue.

Recurring revenue quality

Positive

~90% of revenue is recurring/transaction-based with high renewal rates. Business Solutions is multi-year contract-based. Low churn, high visibility.

Capital return discipline

Positive

Refreshed $150M buyback (~7.8% of cap) + $0.20/yr dividend. Shares outstanding down ~2% YoY. Priority: accretive M&A + buyback.

Regulatory (LatAm fintech)

Moderate

Central bank rules (Pix in Brazil, open banking mandates) can compress margins on some payment products. EVTC has adapted historically but ongoing risk.

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SWOT analysis

Strengths

+Dominant PR network (near-monopoly ATH), high switching costs
+~40% Adj EBITDA margin, ~26% ROE, asset-light model
+Growing LatAm platform via disciplined M&A (Dimensa, Transbank, BBChain, Tecnobank)
+~90% recurring revenue, sticky contracts
+Capital return: buyback $150M + dividend

Weaknesses

−Geographic concentration in Puerto Rico (fiscal/demographic overhang)
−Net leverage 2.55x above asset-light peer norm
−Under-covered by sell-side (only 6 analysts)
−Cyber incident May 2026 unresolved

Opportunities

→LatAm digital payments TAM +15% CAGR through 2030
→Multiple re-rating as LatAm becomes majority of revenue
→Cross-selling Business Solutions to LatAm bank customers
→Additional M&A in fragmented LatAm fintech landscape

Threats

!LatAm FX depreciation eroding reported growth
!Central bank instant-payment schemes (Pix) compressing take rates
!PR macro deterioration or hurricane events
!Global payments giants (FI, GPN) accelerating LatAm push

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Summary by assessment area

🟢 Financial risk — LOW

~40% EBITDA margin, ~26% ROE, ~$300M FCF/yr
Leverage 2.55x manageable, within company target
Buyback + dividend signal cash confidence

🟡 Business risk — MEDIUM

PR concentration structural overhang
LatAm expansion still integrating
Cyber incident unquantified liability

🟢 Valuation — ATTRACTIVE

Fwd P/E ~8x, EV/EBITDA ~6.7x vs peers 13-15x / 10-12x
Base FV $48 vs $31.98 = +51% upside
Even bear case ($34) offers +6% - asymmetric

Sources & Disclaimer

Sources: EVERTEC Q2 2026 earnings release (Aug 4, 2026), Business Wire; Q2 2026 earnings call transcript (StockAnalysis, TheFly); StockAnalysis.com EVTC overview + history; Investing.com EVTC live quote; CNN EVTC quote; Yahoo Finance; Morgan Stanley PT raise Aug 7 (TheFly); Raymond James note; Sahm Capital note on ROE. Market data — last verified close 2026-08-13: EVTC $31.98, market cap ~$1.91B, 52W: $21.81 - $37.71, 59.75M sh outstanding. Short interest: ~3.5%. Report date 2026-08-16 (Saturday); price used is 2 trading days before report date (Fri Aug 14 close not verifiable at run time from public snippets; Investing.com live shows ~$31.18 confirming the same range, cross-checking StockAnalysis.com Aug 13 close of $31.98). This document is for informational purposes only and does not constitute financial or investment advice.