Jack Henry & Associates (JKHY) is benefiting from competitive dislocation and expansion into new addressable markets, supporting mid-to-high single-digit topline growth over the next several years, RBC Capital said in a Wednesday note.

According to the report, the company delivered strong fiscal Q4 results, with revenue and EPS above estimates, while sales momentum remained solid, including 58 competitive core wins. Tap2Local also added more than 200 banks and credit unions and doubled its active merchant base.

For 2027, management expects GAAP revenue of $2.68 billion to $2.71 billion, adjusted revenue of $2.66 billion to $2.68 billion and GAAP earnings per share of $7.33 to $7.38, with GAAP operating margin of 24.5% to 24.7% and adjusted operating margin of 24.1% to 24.3%.

The brokerage expects fiscal Q1 FY27 to be modestly below full-year guidance due to timing and one-time revenue items, while near-term margins face pressure from medical costs and infrastructure spending, with longer-term expansion supported by AI-driven productivity and favorable product mix.

RBC maintained its outperform rating on the stock and increased its price target to $178 from $173.

Jack Henry & Associates shares were up over 2% in Thursday trading.

Price: 166.46, Change: +3.40, Percent Change: +2.08