Fintech small cap IDT Corp. soars on earnings, higher dividend

Shares of fintech small cap IDT Corporation surged more than 10% on Friday, March 7. The company reported double-digit growth in fiscal-2025 second-quarter gross profit and announced a 20% boost to its regular quarterly dividend and an acceleration of its share buyback program.

On Friday, IDT shares jumped more than 10% on the New York Stock Exchange to $50.89 per share, its highest mark since mid-November. After the closing bell, the stock gave back 3.7% to end at $49.00 per share.

The day before, the company had released its financial results for the fiscal-2025 second quarter (ended January 31). Consolidated revenue grew only 2% year over year to $303.3 million. However, key profitability metrics showed double-digit growth. Gross profit increased 16% year over year to $112 million, adjusted EBITDA soared 56% to $34 million, and earnings per share jumped 40% to $0.80.

Thanks to its strong financial position, the company decided in the second quarter to accelerate its share buyback program, with $8.5 million spent, and raised its quarterly dividend by 20% to $0.60 per share, as pointed out by IDT CEO Shmuel Jonas in the earnings announcement.

IDT Corporation’s business consists of four segments: National Retail Solutions (NRS), which sells point-of-sale systems; BOSS Money, a money transfer service; net2phone, a provider of cloud-based communications services; and traditional communications.

In the second quarter, three of these segments showed top-line growth. NRS revenue grew 31% year over year to $33.0 million, BOSS Money 34% to $33.5 million, and net2phone 6% to $21.5 million. The traditional communications segment was the outlier, with its top line falling 5% year over year to $212 million. The earnings announcement noted that the company “continues to mitigate the impacts of the ongoing industry-wide declines in paid-minute voice through a traffic mix shift to higher margin routes, new service offerings, and operational efficiencies.”

Simply Wall St was upbeat after the earnings release: “IDT's earnings per share have been soaring, with growth rates sky high. The sweetener is that insiders have a mountain of stock.” The news and analysis site pointed out, however, that over the last three months, insiders have been selling shares, taking profit.

Since the beginning of the year, IDT is up 7%, while the main U.S. stock index, the S&P 500, is down almost 2%. Over the last 12 months, IDT has delivered almost a 40% return to investors, versus 12% for the S&P 500.