Corpay, Inc (CPAY): what the price assumes

In the published model solve dated 2026-Q2, anchored at $407.88, Corpay, Inc (CPAY) is priced for +1.1% growth. boothcheck publishes no house fair value, target price, or buy/sell rating; individual model outputs and user-controlled scenarios are analytical inputs, not Boothcheck targets. Narrative composed 2026-07-25.

Generated: 2026-08-31 · Source: https://boothcheck.com/report/CPAY

Headline

What The Price Assumes (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

The operating-margin figure is value-band context at year 11: derived from the framework's value band, a separate calculation — not part of the priced-in solve.

Solve inputs: computed at a 8.1% cost of capital with 4% terminal growth over a 5-year stage.

How unusual the bet is: within-range (limited comparison data)

Valuation X-Ray

Asset, earnings-power and peer-multiple models all land far below the price; ONLY the growth-DCF reaches it. The bet is durable compounding the static frames structurally cannot price (a moat/durability premium).

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

Families that justify the price: Growth Families that call it expensive: Asset, Earnings, Relative

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 6.1%); the inversion above states its own rate.

Per-Model Detail (n=13)

Economic-Unit Decomposition (Sum Of The Parts)

One or more material disclosed units has unresolved economics. Unknown/general is not evidence of homogeneity: segment SOTP is primary but incomplete, consolidated cash flow may remain only a secondary cross-check when every unit shares an enterprise basis, and one sector multiple or target margin is withheld.

No total common-equity value is stated. One or more material units lack a supported unit value. The displayed values are an indicative subtotal; consolidated debt and cash cannot be applied to a fraction of the company.

Solvency

Bullet Takeaways

• Three payment businesses sit under one roof, and the mix is moving fast: in the March 2026 quarter Corporate Payments revenue reached $503.9 million against $345.1 million a year earlier while Lodging Payments was roughly flat at $111.0 million.
• The method behind the growth is acquisition, with the annual report stating that "Since 2002, we have completed over 100 acquisitions of companies and commercial account portfolios", and the borrowings that funded them leave operating profit covering the interest bill about 5.2 times over.
• Second-quarter results are due on August 5, 2026, and the line to watch is how much of the revenue increase came from businesses the company already owned a year ago.

Bull Case

Two very different uses of cash are running at the same time here, which is rarer than it sounds. In the March 2026 quarter Corpay repurchased 2.4 million shares for $786.0 million, and since the buyback began it has retired 38.0 million shares for an aggregate $9.4 billion. On April 23, 2026 the board added a further $1.0 billion to the authorization. It is also still buying companies: the annual report notes that "Since 2002, we have completed over 100 acquisitions of companies and commercial account portfolios". Most serial acquirers stop retiring stock, because the same dollar cannot do both jobs. This one has been doing both.

The reason it can is the margin. Corpay earns about 45.5% at the operating line. WEX, the closest listed comparison in fuel and fleet cards, earns 24.6% on $2.698B of revenue. FISV earns 25.3% on $21.09B. PYPL earns 17.9% on $33.73B and GPN 15.3% on $8.26B. Corpay is running at nearly double the best of them, and the annual report explains where that comes from in ordinary language: "the majority of revenue is derived from business customers, which tend to have relatively predictable, consistent volumes". Consumer payments companies fight for transactions one at a time. Corpay signs a commercial fleet or a corporate accounts-payable department and then collects on every transaction that department makes for years.

The mix inside the company is shifting toward the part that is compounding fastest. In the March quarter Corporate Payments produced revenue of $503.9 million against $345.1 million a year earlier, Vehicle Payments $563.9 million against $474.3 million, and Lodging Payments $111.0 million against $110.2 million. Total revenue rose 25.4% to $1,261.0 million and consolidated operating income rose 48.9% to $636.2 million. Operating profit growing at nearly twice the rate of revenue is what operating leverage looks like when the platform underneath is already built.

The pruning is as revealing as the buying. Corpay sold its PayByPhone parking business during the first quarter, booking a taxable gain of $40.0 million. Parking is a consumer-facing business sitting inside a company whose entire economic case rests on commercial customers, and the annual report lists parking competitors as "ParkMobile, ParkHub, Parking BOXX and FLASH". Selling it is a small transaction that says something specific about where management thinks the returns are.

The guidance record supports the impression of a management team that knows its own book. Since 2011 it has raised guidance on 34 separate occasions, reaffirmed on six, initiated new guidance three times, and withdrawn it once. Diluted shares fell to 68.4 million in the March 2026 quarter from 71.6 million a year earlier, so the growth in the business is landing on a smaller base of owners each year. That combination, a widening operating margin and a shrinking share count, is the mechanical definition of compounding.

Bear Case

A company that has bought more than a hundred businesses is not really a company with a product. It is a company with a method, and methods depend on conditions. Corpay's requires a steady supply of acquirable payment franchises, financing cheap enough to make the arithmetic work, and an integration machine that keeps up. When any of those three tightens, reported growth and underlying growth stop being the same number, and the gap only becomes visible some quarters later.

The financing leg is the one already carrying weight. At March 31, 2026 the company reported $8.22 billion of notes payable, credit agreements and other obligations, and in May it amended its credit agreement to increase revolving commitments by a further $0.9 billion. Operating profit covers the interest bill about 5.2 times over, which is adequate rather than generous, and it is adequate at a moment when the business is performing well. A serial acquirer's leverage is fine until the acquisitions stop earning what the model assumed, at which point the interest is still due and the growth is not.

The 45.5% operating margin also deserves a harder look than admiration. No listed peer is close: WEX earns 24.6%, FISV 25.3%, PYPL 17.9%, GPN 15.3%, FOUR 8.4%. Sometimes a margin like that means a genuinely better business. Sometimes it means the reported segments are not doing the same work the peers' segments do. Either way it is a level that invites entry, and the annual report says who is coming. In fuel cards, "major oil companies, petroleum marketers and large financial institutions may choose to integrate fuel card services" themselves. In lodging, the competition includes "traditional travel management companies such as, American Express Global Business Travel, as well as in-house travel solutions at large corporations and airlines". The company's own framing of where that leads is unsentimental: "we may have to increase the incentives that we offer to our customers, decrease the prices of our solutions or lose customers, each of which could adversely affect our operating results".

Lodging is already showing what a saturated line looks like. Revenue there was $111.0 million in the March quarter against $110.2 million a year earlier. That is a segment that has stopped growing while the two beside it accelerate, and it is roughly a tenth of the company. A method that works at the group level can be hiding a line that has quietly stopped working.

Incentives are worth naming plainly, because they were reset this month. On July 22, 2026 the compensation committee approved special performance-based restricted stock unit grants to the chief executive and another senior officer, earned on the company's stock price performance. The same management decides how much stock to retire, and buybacks move the price of a share independently of the value of the business. That is not an accusation of anything; it is a description of the arrangement a shareholder is now inside.

The methods themselves split on this name, and the split is informative. Peer multiples and the forward-growth methods reach the price. The asset-value approaches land below it, and the earnings-power methods, which capitalize a five-year average of operating income and credit no growth at all, land furthest below of any family. That last one is the bear thesis in mechanical form: strip out the growth that acquisitions supply, value what the assembled company earns on average, and the price stops being defensible. The bull's answer is that stripping out the acquisitions is stripping out the business. Both statements are true, which is why this one is genuinely contested rather than merely cheap or merely dear.

Valuation

Roughly 15.6 times operating income, and an implied requirement of about 1% a year of operating profit growth over five years. Those two figures, taken together, are the most interesting thing on this page. The price is not demanding much of this business. It is demanding close to nothing, and then applying a discount to the possibility that close to nothing is what arrives. To see how modest the bar is, set it beside what the company has actually done: measured across its own operating record, Corpay's mean annual expansion has run near 20%.

That is not a distribution the engine treats as unusual. On the scale that runs from ordinary to extreme, this sits at the ordinary end, and the multiple itself sits in the lower half of the range at which its payments peers trade. Two cautions belong on the implied figure anyway: it is one solve rather than a measurement, and it moves by roughly 6.6 points for every point of change in the cost of capital, which was set at 8.0% here with a 4% rate beyond year five. At a slightly higher cost of capital the requirement turns negative, which is another way of saying the price is close to the point where it asks the business to shrink.

The methods do not agree, and the shape of the disagreement carries the argument. Peer multiples land almost exactly at the price, and the forward-growth methods land above it. The asset-value approaches sit well below, and the earnings-power methods sit furthest below of the four. The mechanism behind that last one is worth stating plainly: it takes a five-year average of operating income, taxes it, and capitalizes the result with no growth credited at all. For a company whose operating income has risen every year partly because it keeps buying more of it, an unweighted five-year average is structurally a rear-view mirror. It is not wrong. It is answering a different question from the one a buyer is asking.

The business underneath is three lines of unequal health. Vehicle Payments supplies about half of revenue, Corporate Payments about two fifths, and Lodging Payments the remaining tenth. In the March 2026 quarter that split moved: Corporate Payments revenue of $503.9 million against $345.1 million, Vehicle Payments $563.9 million against $474.3 million, and Lodging Payments $111.0 million against $110.2 million, with total revenue up 25.4% to $1,261.0 million and consolidated operating income up 48.9% to $636.2 million. Against peers the profitability is the standout: Corpay runs about 45.5% at the operating line while WEX runs 24.6% on $2.698B of revenue, FISV 25.3% on $21.09B and GPN 15.3% on $8.26B.

Where the caution belongs is the financing. The March 2026 filing shows $8.22 billion of notes payable, credit agreements and other obligations, and operating profit covering the interest bill about 5.2 times over. That is a working balance sheet rather than a spare one, and it is doing two jobs at once: funding acquisitions and funding a buyback that has retired 38.0 million shares for $9.4 billion since it began, taking diluted shares to 68.4 million in the quarter from 71.6 million a year earlier. The low multiple and the leverage are the same fact viewed from two sides. The market is not disputing what Corpay earns today. It is declining to pay much for the assumption that the machine keeps running at this speed.

Catalysts

Second-quarter results arrive on August 5, 2026. The first quarter set a demanding comparison: total revenue up 25.4% to $1,261.0 million and consolidated operating income up 48.9% to $636.2 million, with Corporate Payments the engine at $503.9 million against $345.1 million a year earlier. The split between acquired and underlying growth is the number that decides how much of that is repeatable.

Capital allocation has been unusually active in the intervening months. On April 23, 2026 the board increased the repurchase authorization by $1.0 billion, after the company bought 2.4 million shares for $786.0 million during the first quarter. On May 21, 2026 it signed the eighteenth amendment to its credit agreement, lifting revolving commitments by $0.9 billion. More revolver capacity and more buyback authorization at the same time is a company preparing to spend, and the second-quarter filing will show on what.

One governance item landed days ago and is worth tracking rather than reacting to. On July 22, 2026 the compensation committee approved special performance-based restricted stock unit grants to the chief executive and another senior officer, with vesting tied to the company's stock price performance. Grants of that shape are usually made when a board wants a specific outcome over a specific window, and the terms disclosed in the coming proxy will say which outcome and which window.

Peer Cohorts (Per Segment, With Filing Citations)

Vehicle Payments (reported)

• WEX (WEX Inc.)
• FY2025 10-K: …milestones. When such fee rebates constitute consideration payable to a customer or other party that purchases services from the customer, they are considered variable consideration and are recorded as a reduction in payment processing revenue in the same period that related interchange income is recognized. For the…
• FY2025 10-K: …team, we optimize revenue for our customers. Our capabilities and solutions broadly fall into two categories: • Embedded Payments . Our customizable Embedded Payments solution integrates virtual payment capabilities into existing workflows, whether payments are core to the business, part of critical operations, or an…
• PAYO (Payoneer Global Inc.)
• FY2025 10-K: …collected upon the completion of the underlying transaction. ​ F-21 Table of Contents PAYONEER GLOBAL INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) U.S. DOLLARS IN THOUSANDS (EXCEPT SHARE DATA) ​ NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (continued): Card and customer account revenue: 1) Transaction fee…
• FY2025 10-K: …the funds in their account. These fees are earned when customers withdraw their funds or use those funds to make payments. We also earn fees in certain instances when customers receive funds, such as through our invoicing services, or via their webstore activity. Some services, such as our virtual commercial card…
• FLYW (FLYWIRE CORPORATION)
• FY2025 10-K: …bear primary responsibility for the fulfillment of the payment service, and have full discretion in determining the fee charged, we act as a principal. As such, we recognize payment processing fee charged on a gross basis. We also earn revenue from fees charged to credit card service providers for marketing…
• FY2025 10-K: …an immaterial amount for implementation services. Variable Consideration The Company's contracts contain variable consideration as the amount the Company expects to receive in a contract is based on the occurrence or non-occurrence of future events, such as processing services performed as a transaction-based pricing…

Corporate Payments (reported)

• WEX (WEX Inc.)
• FY2025 10-K: …team, we optimize revenue for our customers. Our capabilities and solutions broadly fall into two categories: • Embedded Payments . Our customizable Embedded Payments solution integrates virtual payment capabilities into existing workflows, whether payments are core to the business, part of critical operations, or an…
• FY2025 10-K: …reduction initiatives. 59 Table of Contents PART II Corporate Payments Revenues The following table reflects comparative revenue and key operating statistics within Corporate Payments: Twelve Months Ended December 31, Increase (Decrease) (in millions, except per transaction data) 2025 2024 Amount Percent Revenues…
• PAYO (Payoneer Global Inc.)
• FY2025 10-K: …Capital advance fees : The Company offers customers a capital advance in exchange for a fixed amount of their future receivables. Such customers use Payoneer's payment services to receive payments from third-party online marketplaces for goods and services sold on the marketplaces. For the capital advances in which…
• FY2025 10-K: …patterns. Historically, we have seen revenues increase in the fourth quarter of every year, primarily as a result of higher e-commerce sales during the holiday season. Competition Payoneer operates on a global scale and faces a very broad set of competitors. There are many types of payment providers that offer global…
• FLYW (FLYWIRE CORPORATION)
• FY2025 10-K: …between the client and the client's customer. Therefore, revenue is only recognized for the fee to which the Company is entitled for processing the payment. In addition, the Company incurs costs in processing payments which may include banking, credit card processing, foreign currency translation, partner fees,…
• FY2025 10-K: …in funds payable to clients, in the consolidated balance sheets. The amounts are generally collected or paid within one to 30 days. Partners report to the Company the funds received from the client's customer on a daily basis. Revenue in transactions where Partners are involved is not recognized until the payment is…
• FOUR (SHIFT4 PAYMENTS, INC.)
• FY2025 10-K: …goods or services is transferred to its customers. The Company provides its merchants with an end-to-end payments offering that combines its payments platform, including its proprietary gateway and breadth of software integrations, and its suite of technology solutions. The Company primarily earns revenue through…
• FY2025 10-K: -Laws of Shift4 Payments, Inc. S-8 333-239042 4.2 06/09/2020 3.4 Certificate of Designations of 6.00% Series A Mandatory Convertible Preferred Stock. 8-K 001-39313 3.1 05/05/2025 4.1 Specimen Stock Certificate evidencing the shares of Class A common stock. S-1/A 333-238307 4.1 06/01/2020 4.2 Description of Capital…
• GPN (GLOBAL PAYMENTS INC.)
• FY2025 10-K: …acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are…
• FY2025 10-K: 24; Transaction Agreement, dated as of April 17, 2025, by and among Global Payments Inc., Genesis Merger Sub I, Inc., Genesis Merger Sub II, Inc., Genesis Merger Sub III, Inc., Genesis Merger Sub IV LLC, Genesis Washington Merger Sub LLC, GTCR W Aggregator LP, Worldpay Holdco, LLC, GTCR W Management Blocker Inc., GTCR…
• PYPL (PayPal Holdings, Inc.)
• FY2025 10-K: …our PPWC product, merchants can borrow a certain percentage of their annual payment volume processed by PayPal and are charged a fixed fee for the loan or advance based on the overall credit assessment of the merchant. Loans and advances are repaid through a fixed percentage of the merchant's future payment volume…
• FY2025 10-K: …8-K 5/23/2022 4.06 Officer's Certificate, dated as of June 9, 2023, pursuant to the Indenture, dated as of September 26, 2019, by and between PayPal Holdings, Inc. and Computershare Trust Company, N.A. as successor to Wells Fargo Bank, National Association, as Trustee, containing Forms of Note for 0.972% Notes due…

Lodging Payments (reported)

• WEX (WEX Inc.)
• FY2025 10-K: …and unbilled amounts due from customers across a wide range of industries and other third parties. The Company often extends short-term credit to cardholders and pays the merchant or payment network, as applicable, for the purchase price, less the fees it retains and records as revenue. The Company collects the total…
• FY2025 10-K: …custodial services performed on behalf of our HSA account holders. Customers, including health plans, third-party administrators, financial institutions and payroll companies, typically enter into three to five-year contracts, which contain significant termination penalties. This revenue is within the scope of Topic…
• FOUR (SHIFT4 PAYMENTS, INC.)
• FY2025 10-K: …all periods presented. Accounts Receivable Accounts receivable are primarily comprised of amounts due from the Company's customers. Most receivables are typically received within ten business days following the end of the month. In addition, accounts receivable includes amounts due from merchants for point-of-sale…
• FY2025 10-K: Global Blue Transaction Agreement") and (ii) permit the incurrence and/or issuance of the Bridge Facilities (as defined below) and/or certain other permanent financing issued in lieu thereof or to refinance the loans thereunder. On June 30, 2025 (the "Second Amendment Effective Date"), the Borrower entered into an…
• GPN (GLOBAL PAYMENTS INC.)
• FY2025 10-K: …ASC 606, we recognize revenue when a customer obtains control of promised goods and services. The amount of revenue recognized reflects the consideration to which we expect to be entitled to receive in exchange for these goods and services. Merchant Solutions. Our customers in the Merchant Solutions segment contract…
• FY2025 10-K: …which are primarily comprised of the cost of property taxes, insurance and maintenance. Finance lease costs for the year ended December 31, 2023 were $ 11.2 million, including $ 10.5 million of amortization on right-of use assets and $ 0.7 million of interest on lease liabilities. Lease costs for leases with a term…
• FISV (FISERV INC)
• FY2025 10-K: …receivables based on the number of calendar days past due. The Company considers lease payments that are 90 days or less past due as performing. Lease payments that are greater than 90 days past due are placed on non-accrual status in which interest income within product revenue is no longer recognized. Lease payment…
• FY2025 10-K: …based on volume of service; however, pricing for services may also be based on fixed or monthly minimum processing fees. Fees for our processing and services arrangements are typically billed and paid on a monthly basis. Product Product revenue is generated from print and card production, software license, data and…
• PYPL (PayPal Holdings, Inc.)
• FY2025 10-K: …not captured in the quantitative estimates of our current expected credit losses. The allowance for current expected credit losses on fees receivable is determined primarily by applying loss curves to each portfolio by geography, delinquency, and period of origination, among other factors. For merchant loans and…
• FY2025 10-K: …do not believe any of these new accounting pronouncements have had, or will have, a material impact on our consolidated financial statements or disclosures. NOTE 2- REVENUE We enable our customers to send and receive payments. We earn revenue primarily by completing payment transactions for our customers on our…
• WU (THE WESTERN UNION COMPANY)
• FY2025 10-K: …are included in the Company's Consumer Money Transfer segment and revenues from consumer bill payment, travel money, and other services are included in the Company's Consumer Services segment. Revenues from business-to-business foreign exchange and payment services were included in the Company's Business Solutions…
• FY2025 10-K: …to offer money transfer services to their own customers under their brands. Generally, in these arrangements, consumers agree to terms and conditions specified by the financial institution or other third party that, among other things, establish pricing paid by the consumer for the service. The Company recognizes…
• PAY (Paymentus Holdings, Inc.)
• FY2025 10-K: …countries as their functional currency. Assets and liabilities are translated using the exchange rates at the balance sheet date. Revenue and expenses are translated at average exchange rates during the period. Equity transactions are translated using historical exchange rates. The effects of foreign currency…
• FY2025 10-K: …liabilities relate to fees billed in advance of services provided. The terms of the contract normally require the customer to pay a fixed monthly fee for hosting and maintenance, plus a non-refundable up-front fee for set-up, integration services and data conversion at contract inception. The non-refundable up-front…
• FIS (Fidelity National Information Services, Inc.)
• FY2025 10-K: …obligation, and revenue for the combined performance obligation is recognized as the professional services are provided, consistent with the methods described below for professional services revenue. The Company has contracts where the licensed software is offered in conjunction with hosting services. The licensed…
• FY2025 10-K: …requires judgment and may affect the timing and amount of revenue recognized. To determine the standalone selling price of its promised solutions or services, the Company conducts a regular analysis to determine whether various solutions or services have an observable standalone selling price. If the Company does not…

Methodology Note

• Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
• Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
• Economic-unit decomposition (SOTP): each disclosed business unit is assigned its native valuation basis before any multiple is applied. Operating units are valued on enterprise value; funded financial units are valued on their own common equity, because their borrowings fund earning assets rather than levering the parent. A company total is stated only once every material unit carries a supported value and the parent capital bridge reconciles.
• Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
• Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.