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Ahead of the Bell: CheckFree Climbs
Wednesday January 31, 8:49 am ET
Shares of Checkfree Rise As Company Adds Major Customers During Second Quarter
NEW YORK (AP) -- Shares of CheckFree Corp. rose in pre-market trading Wednesday after the electronic payments processor posted strong fiscal second-quarter profit fueled by more transactions and several key customer signings.
Norcross, Ga.-based Checkree, which facilitates more than one billion payments a year, beat Wall Street's forecasts for second-quarter earnings and said revenue rose 11 percent.
SunTrust Robinson Humphrey analyst Andrew W. Jeffrey said the quarter saw large companies adopt CheckFree's technology to host payments through the Internet and electronic portals.
Jeffrey pointed to CheckFree's signing of Wal-Mart Stores Inc., retail bank BB&T Corp. and the "critical enlistment" of American Express Co., as proof CheckFree's strategy "has legs."
CheckFree hosted 3 percent more transactions in the second quarter than the first quarter, spurred by online payments.
The results were "in stark contrast to recent fears of a weak transaction quarter," Robert W. Baird analyst David J. Koning wrote in a client note.
Shares of CheckFree rose $1.80, or 4.6 percent, to $41 in pre-market trading, after closing Tuesday at $39.20 on the Nasdaq.