Investment Case Update: April 2, 2026
Price: $42.76 (4/2/26)
Market Capitalization: $3.5B
Enterprise Value: $8.7B
What the Company Does
Shift4 provides payment processing and business intelligence software with a focus on the hospitality and entertainment sectors, processing over $300B in payments annually for more than 300,000 customers. Shift4 also owns TheGivingBlock, which is the leading facilitator of charitable giving in cryptocurrency, and processed over $100MM in donations in 2025 with an average gift size of ~$11K. With the recent acquisition of Global Blue, FOUR is also now a leading provider in tax-free shopping for some of the world’s largest luxury retail brands. Shift4 has historically operated in the United States but has started to expand internationally and now commands a presence in more than 75 countries.
Why We Own It
Shift4 provides sticky, and likely growing, cash flows at a compelling valuation with an impressive, highly aligned management team in a large addressable market. Former CEO Jared Isaacman founded the company in his teens and grew it in a capital-efficient way until he transitioned to becoming the company’s Executive Chairman in June 2025. Between the end of 2020 and 2025, total employee headcount grew ~4.8x, while Adjusted EBITDA per employee (i.e. productivity) grew ~2.3x over the same period. Over the company’s first sixteen years, Shift4 grew organically with neither outside capital nor acquisitions and has increased revenue by a double-digit percentage in all 27 years of the company’s history, including through downturns. Recently, management has created value through disciplined, cost-efficient acquisitions and reinvestments, deploying $5.5B since June 2020, while consistently earning returns above their cost of capital, with FOUR’s average return on invested capital (ROIC) since 4Q23 exceeding the midpoint of its weighted average cost of capital (WACC) range by ~320bps.
Management still sees a long runway for growth in an estimated $14T addressable market, as organic growth opportunities, particularly international expansion, enabled by the acquired infrastructure and cross-sell potential across Global Blue and Smartpay’s merchant networks, are expected to drive 3-year revenue and Adjusted EBITDA compound annual growth rates of 25%+ between 2025-2027.1 Today, FOUR trades at 6.3x FY27 EBITDA estimates, or a ~15% discount to its peer group (FIS, PYPL, XYZ, TOST, WEX, GPN, LSPD, FI) average multiple despite significant prospects for continued top-line growth and margin expansion.
How Management Allocates Capital
The company’s new CEO has reiterated management’s 3 priorities are – 1) customer acquisition, 2) product investments (R&D), and 3) M&A and share repurchases. Since FOUR’s returns on customer acquisition are so high, management ultimately views both product investment and M&A as levers to increase cash flow generation and free up more dollars to continue feeding their customer acquisition machine, which carries a less than 12-month payback period. With pro forma net leverage of 3.4x as of 4Q25 nearing management’s net leverage threshold of 3.75x, management is much more focused on strategically aligned, tuck-in M&A in the near term as they integrate recent acquisitions of Global Blue and Smartpay. Amid the recent drawdown in price, management has bought back $648MM (18.7% of market cap) worth of stock since the start of 2025, which leaves $500MM of remaining authorization (14.4% of market cap). FOUR also recently simplified its previously complex Up-C capital structure into a single, standard share class structure, increasing transparency, and resulting in Isaacman owning more than 27% of the company today, further reinforcing alignment with investors.
We originally posted our investment case for FOUR on February 12, 2024.