05. Fiserv, Inc. (NYSE:FI)
Number of Hedge Fund Holders: 73
Fiserv, Inc. (NYSE:FI) is a prominent player in the fintech sector, providing a comprehensive suite of payments and financial services technology across various global markets, including the United States, Europe, the Middle East, and Africa. Fiserv, Inc. (NYSE:FI) innovation in financial technology is exemplified by its robust offerings like Clover, a cloud-based point-of-sale system, and its integrated operating system, Carat. The increasing integration of AI within its services is a critical aspect of its growth strategy, enhancing transaction efficiency and fraud protection.
On October 10, Barclays raised Fiserv’s price target to $215 from $185, maintaining an Overweight rating on the stock. This positive outlook reflects Fiserv’s strong earnings performance and growth potential within the fintech landscape. The company reported a second-quarter adjusted earnings per share of $2.13, surpassing expectations of $2.11, driven by a solid 7% growth in adjusted revenue and an impressive 18% organic revenue growth.
During the recent earnings call, CEO Frank Bisignano emphasized the company’s commitment to technological innovation, particularly highlighting how Fiserv is integrating AI and digital solutions into its service offerings. Notably, Fiserv, Inc. (NYSE:FI) is enhancing consumer payment experiences through partnerships with major firms like Apple, enabling features such as installment loans at checkout. This integration aims to drive card conversion and consumer spending, positioning Fiserv, Inc. (NYSE:FI) as a competitive force in the evolving payments landscape.
With strong free cash flow of $1 billion for the quarter and a focus on strategic growth initiatives, Fiserv, Inc. (NYSE:FI) demonstrates resilience and adaptability in a rapidly changing financial environment. Analysts see a bright future for the company as it leverages technology to maintain its competitive edge and expand its market share, solidifying its status as a fintech leader.
Broyhill Asset Management stated the following regarding Fiserv, Inc. (NYSE:FI) in its Q2 2024 investor letter:
Fiserv, Inc. (NYSE:FI) is the premier provider of financial technology services, supporting banks, credit unions, and financial institutions with innovative banking solutions, payment processing, and data analytics to streamline and secure financial transactions. The company’s shares slid 7% during the quarter before rallying 10% in July to fresh all-time highs. Clover remains the company’s crown jewel, generating over $300 billion in annualized GPV (Gross Payment Volume) with better monetization, driving 28% revenue growth in the recently reported quarter, and three new hardware products plus pilot programs in Mexico and Brazil going live in the coming months. Simply put, there are few businesses in this industry executing even close to the same level, and fewer still with Fiserv’s scale, distribution, and collection of assets. In our initial write-up, we highlighted the embedded distribution advantages often enjoyed by incumbents, noting that “Fiserv can cross-sell products through its large, engrained distribution channels, driving faster growth than even its most rapidly growing peers. And with Clover and Square accounting for less than 10% of a fragmented market, we think there is plenty of room for both to run.” Notably, Jack Dorsey, Chief Block Head, Square Head, Chairman, and Cofounder, recently came to the same conclusion, admitting as much on the company’s most recent earnings call: “I would state that our product quality is far above the majority of our competitors. Where we have been weaker in the past is how we mirror that with our go-to-market strategy and just updating our approach there, especially given what our competitors have done.“ We wonder which competitors come to mind.
