FISV
Fiserv, Inc.
Finance/Real Estate, TMT
06/22/2020
Presented
| Date | 06/17/2020 |
| Price | $103.15 |
| Market Cap | $69.06B |
| Ent Value | $88.43B |
| P/E Ratio | 56.91x |
| Book Value | $47.25 |
| Div Yield | 0% |
| Shares O/S | 669.48M |
| Ave Daily Vol | 4,967,403 |
| Short Int | 2.49% |
Current
| Price | $194.02 |
| Market Cap | $111.70B |
| Fiserv, Inc. engages in the provision of financial services technology. It operates through the Payments, Financial, and Corporate and Other segments. The Payments segment primarily provides electronic bill payment and presentment services, internet and mobile banking software and services, account-to-account transfers, person-to-person payment services, debit and credit card processing and services, payments infrastructure services, and other electronic payments software and services. The Financial segment provides financial institutions with account processing services, item processing and source capture services, loan origination and servicing products, cash management and consulting services, and other products and services that support numerous types of financial transactions. The Corporate and Other segment consists of intercompany eliminations, amortization of acquisition-related intangible assets, unallocated corporate expenses and other activities that are not considered when management evaluates segment performance, such as gains on sales of businesses and associated transition services. The company was founded by Leslie M. Muma and George D. Dalton on July 31, 1984 and is headquartered in Brookfield, WI. |
Publicly traded companies mentioned herein: Bottomline Technologies DE Inc (EPAY), Fiserv Inc (FISV), Global Payments Inc (GPN), PayPal Holdings Inc (PYPL), Square Inc (SQ)
Highlights
The presenter is long shares of Fiserv Inc (FISV), noting that its stock price is being suppressed due to a CEO transition. He believes the negative market sentiment is unwarranted given that FISV is an excellent company with ~40% operating margins, a strong FCF profile, and his positive view of new CEO Frank Bisignano. FISV is currently trading at ~$103 per share, or ~18x the presenter’s $5.80 2021 EPS estimate. His model is above the consensus $5.33 expectation, based largely on his view that the company will beat on cost synergies. This 18x multiple is a discount to the overall market and a major discount to FISV’s peers. He views this valuation as especially low considering the stock is down slightly since the release of FISV’s quite bullish Q1’20 results. Overall, he sees upside to ~$133 and ~$166 over the next six and eighteen months, respectively, as the multiple rerates and earnings continue to grow.
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