Shares of Euronet Worldwide (EEFT ) rallied during the session after the company acknowledged press reports of Visa International's (V) rule change to allow dynamic currency conversion on global ATM transactions.

WHAT'S NEW: Euronet acknowledged in a press release this morning the media reports that Visa notified its members on September 27, 2018, that it will allow DCC on international ATM transactions globally effective April 13, 2019. Currently, Visa only allows DCC on POS transactions globally and on intraregional ATM transactions in the European region. The rule change will allow acquirers and ATM operators to offer DCC to all international ATM transactions on Visa-branded cards around the world. Euronet noted that it currently offers DCC choice to MasterCard (MA) issued cards at most of its ATM estate of the more than 41,000 ATMs as well as more than 125,000 bank-operated ATMs around the world. However, for Visa-issued cards, Euronet has been restricted to offering DCC choice to only cards issued and used in Europe for ATM cash withdrawals. With this rule change, effective, April 13, 2019, Euronet will be able to expand its ATM DCC offering to all Visa-issued cards on its existing ATM base in Europe and on new and existing ATMs around the world. In addition to expanding the availability of DCC for cards issued and presented around the world, Visa also included in its announcement that it was making available in April 2019, several other ATM-related products including share deposits, access fee-free service, account-to-account transfers, mini-statements, and PIN change and unblock. Euronet anticipates that these value-added services may lead to additional opportunities for the company. Additionally, Euronet said that while this announcement will not benefit its 2018 financial results, the company currently expects to increase its 2019 adjusted earnings per share by 60c-65c from its existing base of products and ATMs, net of the new and existing fees imposed by Visa.

STREET RESEARCH: Following the news, Piper Jaffray analyst Jason Deleeuw raised his fiscal 2019 and fiscal 2020 adjusted earnings per share estimates for Euronet to account for the expected accretion benefits from the Visa rule changes. The analyst maintained an Overweight rating on the stock and raised his price target on the shares to $141 from $111. In addition, William Blair upgraded Euronet to Outperform from Market Perform following the announcement.

PRICE ACTION: Euronet shares rose 14.8% after the news.