Fiserv Inc. (FISV) recently extended its partnership with a leader in integrated risk and finance solutions, Primatics Financial. The alliance was extended to provide financial institutions with advanced stress testing solutions in support of macroeconomic and regulatory stress testing.
In Jun 2014, both the companies had partnered to provide financial institutions secure, Software as a Service (SaaS) solutions for comprehensive loan accounting support for banks doing acquisitions.
The Primatics Evolv suite is the sole web-based solution that supports the acquisition lifecycle including the entire stress testing process from model execution to loss estimation to GAAP compliant accounting forecasting.
We believe that this extended partnership will enable Fiserv to cater better to the needs of its clientele, thereby driving profitability going forward.
Separately, Fiserv announced that its share repurchase authorization has been increased by $20 million shares. We believe that this increase will boost shareholder confidence.
Fiserv has expanded its foothold in the financial and payment solutions business supported by its broad customer base and various contract wins from the likes of U.S. Bank, TD bank and Bank of Ozarks. We note that enhanced operating efficiency is the primary reason behind the company’s ever-growing banking and financial services clientele.
Moreover, the company’s partnership with Visa (V) will allow it to offer debit EMV solutions for the Accel debit network. We believe that EMV-based card solutions have significant growth opportunities in the U.S. and this partnership will boost Fiserv’s EMV offering.
However, intensifying competition from the likes of Global Payments (GPN) and MasterCard Inc. (MA) remains a major headwind, going forward.
Currently, Fiserv has a Zacks Rank #3 (Hold).
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