1) Fiserv, Inc. (NYSE:FI)
Number of Hedge Fund Holders: 73
Fiserv, Inc. (NYSE:FI) provides payments and financial services technology services.
While Fiserv, Inc. (NYSE:FI) has positioned itself as a critical player in the digital transformation of financial services, the company’s growth trajectory is expected to be aided by its global presence and diverse portfolio of products and services. By increasing its reach, the company plans to capture more market share and penetrate new markets. It has been focusing on software and value-added services, highlighting that the shift towards higher-margin offerings should help drive profitability and enhance the value proposition.
Fiserv, Inc. (NYSE:FI) plans to take its Clover platform international, which should help open up new growth avenues. The increased penetration of Value-Added Services (VAS) and expansion of verticalized software offerings are expected to fuel its long-term growth. Such initiatives, together with its unique advantage in distribution channels, place the company well.
By providing additional services beyond core payment processing, the company can deepen its relationships with current clients and onboard new ones. UBS Group increased its price objective on the shares of Fiserv, Inc. (NYSE:FI) from $185.00 to $240.00, giving a “Buy” rating on 23rd October.
Madison Investments, an investment advisor, released its third-quarter 2024 investor letter. Here is what the fund said:
“In the third quarter, the top five individual contributors to performance relative to the benchmark were Parker-Hannifin Corporation, Fiserv, Inc. (NYSE:FI), Lowe’s Companies, Brookfield Corporation, and Progressive Corporation. At payment processor Fiserv, revenue and profits continue to grow nicely, in part driven by the strong performance of its Clover payment platform for small-and-medium sized businesses. In our assessment, Clover’s broad adoption by merchants across a wide variety of verticals is due to its superior functionality compared to legacy point-of-sale payment platforms, coupled with Fiserv’s extensive distribution scale across financial institutions and independent sales organizations. This latter advantage is especially difficult for emerging fintech competitors to replicate, reinforcing our confidence in the company’s long-term prospects.”
While we acknowledge the potential of FI as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for a deeply undervalued AI stock that is more promising than FI but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.
Disclosure: None. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and investors. Please subscribe to our daily free newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.
