Whenever a company suffers an unexpected blow, the way its stock recovers says a lot about its fortitude. Shift4 stock is showing it can survive the exit of its Chief Executive and founder, Jared Isaacman.
The stock sold off more than 12% on Dec. 4, when President-elect Donald Trump named Isaacman to lead NASA. Isaacman will step down as chairman and CEO as soon as the Senate confirms his nomination, according to a filing with the Securities and Exchange Commission.
The company so far has made no public disclosures about its plans for a replacement. A few analysts downgraded the stock following the news.
Jared Isaacman Friendly With Musk
Far from the aerospace business, Shift4 is a payment processing firm that serves hundreds of thousands of companies. It processes digital payments for Elon Musk's satellite internet service, Starlink, and Isaacman is close with Musk.
But for all the uncertainty about its leadership, Shift4 stock is making positive moves. The early December tumble took the stock to the 10-week moving average, where buyers have been appearing.
So far, Shift4 stock hasn't made much of a rebound. It's still about 10% below its Nov. 29 peak. But the support at the 10-week line offers a buy point around 101. The buy range goes to 106.
Despite its tumble, Shift4 stock is still No. 1 by Composite Rating among 36 companies in the credit card and payment processing industry group. Its three-year per-share earnings growth rate is an impressive 129% and the sales growth rate is 36%, according to the IBD Stock Checkup.
Shift4's EPS Rating of 98 is second best in the industry. Analysts expect 2024 earnings to climb 29% and a further 24% in 2025, according to MarketSurge data.
Isaacman's Aviation, Business Background
On Wednesday, Morgan Stanley raised its price target on Shift4 stock to 109 from 90 and kept an equal weight rating, according to Thefly.com. Morgan Stanley cited improving investor sentiment, a call for accelerated investment in competitive strengths, more acquisitions, and easing regulatory scrutiny.
According to a profile in Forbes.com, Isaacman started Shift4 in his parents' basement at the age of 16, back in 1999. In 2011, he founded Draken International, a company that trains air force pilots, and also owns the world's largest private fleet of military aircraft. Isaacman sold a majority stake in Draken to Wall Street investment firm Blackstone in 2019.
