Giverny Capital Asset Management, LLC, an investment management company, recently published its third-quarter 2023 investor letter. A copy of the same can be downloaded here. The firm’s model portfolio returned -3.01% (net) in the third quarter compared to -3.27% return for the S&P 500 Total Return Index. YTD, the fund returned 11.02% compared to the 13.07% return for the Index. In addition, please check the fund’s top five holdings to know its best picks in 2023.
Giverny Capital Asset Management highlighted stocks like Fiserv, Inc. (NYSE:FI) in the third quarter 2023 investor letter. Headquartered in Brookfield, Wisconsin, Fiserv, Inc. (NYSE:FI) offers payment and financial services technology. On November 6, 2023, Fiserv, Inc. (NYSE:FI) stock closed at $119.64 per share. One-month return of Fiserv, Inc. (NYSE:FI) was 4.35%, and its shares gained 21.49% of their value over the last 52 weeks. Fiserv, Inc. (NYSE:FI) has a market capitalization of $71.806 billion.
Giverny Capital Asset Management made the following comment about Fiserv, Inc. (NYSE:FI) in its Q3 2023 investor letter:
“Turning to our new positions, we have been following Fiserv, Inc. (NYSE:FI) for a couple of years now and finally bought a position during the third quarter. Fiserv has two businesses that reinforce each other: it is a key technology provider to several thousand global banks and credit unions. Mid-sized financial institutions need to offer a full complement of digital banking services to compete with larger national banks, but they can’t afford to build out an internal tech capacity. It’s more cost effective to outsource to Fiserv.
Fiserv’s other business is, broadly, payment processing: when you tap and pay at your favorite restaurant or retailer, you may be using a Fiserv device. That device, in turn, may connect directly to the business owner’s bank – and Fiserv built out the bank’s tech stack. The synergy here is important. Fiserv can sell terminals to the restaurant itself, but banks may also sell Fiserv products as part of their customer relationships. There is terrific distribution synergy
For the next few years, Fiserv’s growth should be led by Clover, a payments acceptance system that offers merchants faster transaction times, better fraud protection and stronger operational controls than many existing acceptance networks. While Clover is a clear leader in acceptance, it has a small market share today and could grow at double digit rates for some years. In turn, that should drive solid earnings growth for Fiserv. I believe the stock trades for a low-teens multiple of likely 2024 earnings, an attractive price for a steady compounder.”
A customer making a purchase at a modern retail store terminal, showing the ubiquity of the company’s payment solutions.
Fiserv, Inc. (NYSE:FI) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 68 hedge fund portfolios held Fiserv, Inc. (NYSE:FI) at the end of second quarter which was 64 in the previous quarter.
We discussed Fiserv, Inc. (NYSE:FI) in another article and shared Madison Investors Fund’s views on the company. In addition, please check out our hedge fund investor letters Q3 2023 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
